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Ever since the big recession of the world economy 2007, the central banks in Europe have struggled to regain financial stability. Their goals have been hard to reach and 2014 The European Central bank (ECB) introduced negative interest rates for the first time in the world history. However, today, year 2016, many countries still have not been able to reach their inflation target. During this time with expansive monetary policies, many European Union (EU) members have faced rising level of household debts to GDP. This study focus on EU-members and uses a Vector Autoregressive method, Granger causality test and an impulse-response test to give a greater understanding about the association between the level of household debt and interest rate. Further, it aims to investigate if the negative interest rate has an impact on that association. However, our empirical results show that there is a significant negative association between the level of household debt and the interest rate in Austria, Belgium, Bulgaria, Finland, Germany, Italy, Poland, Romania, Slovakia, Spain and Sweden. Further, they show that there is a granger causality from the interest rate to the level of household debt for Belgium, Finland, Germany, Poland, Slovakia and Sweden. For all these countries, our findings show that a shock in the interest rate have a short-term effect on the level of household debt. Lastly, we found no statistical significant evidence for that the negative association between the interest rate and the level of household debt does increase when the interest rate is negative.

Generally speaking, business cycle could be discussed as a short-term fluctuation of business cycle and long-term economic growth. In this research, we will confer what impact factors might have affected the business cycle of correlations (BCCs) across countries in a period of short time. Many empirical analysis have pointed out the temporary factors to the business cycle mainly come from the transferred factors of economic aspect. This is called ¡§Transmission Mechanisms.¡¨ What is ¡§Transmission Mechanisms?¡¨ Economists often try to substitute it in good markets, financial markets, and the coordination of monetary policies. However, in this duration of the empirical analysis, using only these proxy variables to explain BCCs between two countries seems too limited. According to this situation, we believe if the BCCs can be explained by using proxy factors of non-economic variable, the result can be utilized by making up the defect. We attempt to find new factors in political approach and combine with the ¡§Transmission Mechanisms¡¨ that we have introduced earlier. After that, we expect to comprehend the BCCs among G7 countries from the inputs of the two completed different variables. To analyze further economic implication in our research, five conclusions have been summarized below: Firstly, increasing bilateral trade has significantly provided positive effect to BCCs among G7 countries from 1980 to 2002. Because the empirical result of Single Country is insignificant, we then use a two-stage method. First, we estimate ¡§Trade¡¨ from endogenous variable to exogenous one. Secondly, we use Panel method to expand its matrix. Finally, we improve the empirical estimators of insignificant statistics before. In other words, the important variables of the correlation of bilateral trade are whether or not the two countries speak the same language; the border problem, and the distance between the two are the same, etc. So, when we talk about the relations between BCCs and good and service markets, we must consider these exogenous factors. Eventually, we will receive more detailed results. Secondly, although to trade in financial markets can increase the BCCs between two countries, the statistic report is insignificant -0.0019 (0.0012). About this empirical result, we can obtain reasonable explanations from the researches (for instance: Imbs, 2004 or Kose et al, 2003), they point out that financial markets are bound excessively by globalization. Therefore, this will aggravatingly make each country to focus on its specialization. Finally, this situation will make the BCCs getting collapsed among these countries. This also explains that the specialization among these countries will reduce the positive effect from the BBCs to financial markets. Thirdly, in this empirical research of Single-Country, we use three proxy estimators of economics to substitute common properties of the monetary policy. At this point, there are no identical correlations of corresponding among other countries except some significantly negative trends shown to the member countries of European Union. According to this situation, we believe it may be the consequence to all the member countries under some ERM restrictions, which is Treaty of Maastricht. Also, because of the rules form this treaty, the monetary policies are getting to be accordant, and the BCCs among the countries will soon appear in obviously positive trend. Fourthly, in the model, the difference of the inflation rate between two countries is not significant with BCCs; therefore, an identical correlation is hardly shown. Moreover, the coefficient symbol is not in our expecting direction, so we think maybe some policies are neglected to the influence of this variable. After all these, we believe if we can control some relative policy effect to inflation rate when discussing the relationship between this variable and the BCCs, we should be able to find out the real effect of this substitutive variable to BCCs Lastly, in the research, the statistics effect of the party variables and business cycle of correlations are very significant. This also indicates the political factor will play an important role for many sources of the fluctuation tread of BCCs. In other words, when we discuss the issue of BCCs if miss the contribution of political factors to the BCCs. Then, this might cause the omitted variable biased, and finally cause the whole computation become inefficient. In addition, we can have further discussion by an input of a factor: to conserve the joint benefit of all the member countries in an economic organization, these countries need to be ruled by the same ideal political party. Otherwise, the institute will never reach its essential result. Combining all the conclusions we have shown above, we can find out the BCCs among G7 countries from 1980-2002. Besides the influence of the ¡§Transmission Mechanisms,¡¨ the result will be varied by the political factors. In conclusion, we need to consider the contribution of the political party variables to the BCCs when talking about this issue, therefore; the original theoretical model can be more persuasive. According to a statistics of IMF, the BCCs among those industrial countries are falling little by little in recent years. Therefore, consolidating trade cooperation is essential for what we believe to improve the BCCs among G7. At the same time, pass through a strong integrate monetary policy can move forward all the incumbent parties from all the countries to agree among themselves, and even reach more substantial effect. From the example like this, we might find evidence from BCCs issues by discussing the integration process in European Monetary Union.

Since Bretton Woods System break down in year 1973. Many economists found that there are more similar business cycle between industrial countries. Recently, Doyle and Faust(2002) proposed the correlation of business cycle between two countries becomes weaker. Therefore in this search, we try to carry out two different aspect factor that effects the countries¡¦ business cycle correlation. The factor is so-called ¡§transmission mechanism.¡¨ Generally specking, Many empirical analysis have pointed out the temporary factors to the business cycle mainly come from the transferred factors of economic aspect. What is ¡§Transmission Mechanisms?¡¨ Economists often try to substitute it in good markets, financial markets, and the coordination of monetary policies. However, in this duration of the empirical analysis, using only these proxy variables to explain BCCs between two countries seems too limited. According to this situation, we believe if the BCCs can be explained by using proxy factors of non-economic variable, the result can be utilized by making up the defect. We attempt to find new factors in political approach and combine with the ¡§Transmission Mechanisms¡¨ that we have introduced earlier. To analyze further economic implication in our research, five conclusions have been summarized below: Firstly, increasing bilateral trade has significantly provided positive effect to BCCs among G7 countries from 1980 to 2002. Because bilateral trade intensity index is endogenous , we use exogenous variable as instrumental variable to estimate ¡§Trade¡¨. Secondly, we use Panel method to expand its matrix. Finally, we improve the empirical estimators of insignificant statistics before. So, when we talk about the relations between BCCs and good and service markets, we must consider these exogenous factors. Eventually, we will receive more detailed results. Secondly, although to trade in financial markets can increase the BCCs between two countries, the statistic report is insignificant . About this empirical result, we can obtain reasonable explanations from the researches (for instance: Imbs, 2004 or Kose et al, 2003), they point out that financial markets are bound excessively by globalization. Therefore, this will aggravatingly make each country to focus on its specialization. Finally, this situation will make the BCCs getting collapsed among these countries. This also explains that the specialization among these countries will reduce the positive effect from the BBCs to financial markets. Thirdly, in the research, the statistics effect of the trade intensity index and specialization are significant negative. It means that when good in transaction will result in more specialization. Two countries have similar industrial structure.Imbs(2004) consider the problem is the index we use to measure bilateral trade intensity. This index was effected from two countries¡¦ size . If use Clark and van Wincoop¡¦s trade intensity index to measure the effect, we can find that significant specialization by comparative advantage effect. Fourth, there are high level financial integration between two countries, because international risk sharing result in two countries have different industrial structure. Lastly, in the research, the statistics effect of the party variables and business cycle of correlations are very significant. This also indicates the political factor will play an important role for many sources of the fluctuation tread of BCCs. In other words, when we discuss the issue of BCCs if miss the contribution of political factors to the BCCs. Then, this might cause the omitted variable biased, and finally cause the whole computation become inefficient. In addition, we can have further discussion by an input of a factor: to conserve the joint benefit of all the member countries in an economic organization, these countries need to be ruled by the same ideal political party. Otherwise, the institute will never reach its essential result. Combining all the conclusions we have shown above, we can find out the BCCs among G7 countries from 1980-2002. Besides the influence of the ¡§Transmission Mechanisms,¡¨ the result will be varied by the political factors. In conclusion, we need to consider the contribution of the political party variables to the BCCs when talking about this issue, therefore; the original theoretical model can be more persuasive. According to a statistics of IMF, the BCCs among those industrial countries are falling little by little in recent years. Therefore, consolidating trade cooperation is essential for what we believe to improve the BCCs among G7. At the same time, pass through a strong integrate monetary policy can move forward all the incumbent parties from all the countries to agree among themselves, and even reach more substantial effect. From the example like this, we might find evidence from BCCs issues by discussing the integration process in European Monetary Union.

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This thesis investigates the role of the exchange rate and interest rate channels in the monetary transmission mechanism in Ukraine. The responses on the domes- tic as well as Russian economy shocks are estimated using the Vector Autoregression Model with block-exogeneity restriction. Monetary transmission did not prove to be strongly effective via neither of the estimated channels, although the exchange rate channel demonstrates the results which are more in line with the economic theory. In addition, the exchange rate channel shows the higher and more significant pass through. Further, we estimate the importance of the shocks of both home and for- eign economies for the domestic variables deviations using variance decomposition technique. The relevance of the Russian shocks in fluctuations of home variables is found out. The current estimation of the transmission mechanism is relevant due to the planned inflation targeting regime implementation in Ukraine which requires understanding of that processes in the economy. 1

This paper uses U.S. macroeconomic data drawn from 2001 to 2010 in order to test for the operation of a credit channel of monetary transmission. Using a combination of a VAR and ADL time series frameworks, evidence is found for the impairment of the credit channel during the crisis period relative to the period which preceded it. Evidence is also found against the presence of a "credit crunch" during the crisis, and supporting evidence is found for the existence of a "credit trap." This analysis indicates a significant role for credit market imperfections in the transmission of monetary policy, and holds policy implications for the potential impact of future monetary expansions conducted in the setting of a financial crisis.

This study discusses the monetary policy transmission mechanism in the different channels. The analysis is conducted using generalized impulse response functions derived from a factor-augmented vector error correction (FAVECM) model. The FAVECM methodology as developed by Lee (2009) extends the factoraugmented vector autoregression (FAVAR) model to analyze long-run and shortrun dynamics of non-stationary variables. This recenly derived FAVECM model combines the advantages of factor model and the VECM model. The estimations are conducted using 174 macroeconomic time series in monthly frequency for the period January 2000 to September 2009. Results indicate that interbank call loan rate, deposit rate and prime lending rate are conintegrated, which provides sufficient evidence of the existence of the credit channel in monetary transmission system. Other GIRF results are generally consistent of the expected monetary policy effectiveness.

This study revists Purchasing Power Parity (PPP) and discusses the monetary policy transmission mechanism in exchange rate channels. The analysis is conducted using generalized impulse response functions derived from a Factor- Augmented Vector Error Correction (FAVECM) model. The FAVECM methodology as developed by Lee (2009) extends the Factor- Augmented Vector Autoregression (FAVAR) model to analyze long-run and shortrun dynamics of non-stationary variables. This recently derived FAVECM model combines the advantages of factor model and the VECM model. The estimations are conducted using 157 macroeconomic time series in monthly frequency for the period January 2000 to September 2009. Results indicate that PPP exists and expansionary devaluation effect in Taiwan. Other GIRF results are generally consistent of the expected exchange rate effectiveness.

In current years, renewable energy is an important topic due to the energy crisis and the environments protection issue. One of the renewable energies, wind power has the advantage of high popular rate, convenient, and clear. But there are disadvantages can be improved. The generator has a low quality of output because the variety of wind speed, and it needs electronic equipment to maintain the quality of energy output. According to the research results of Dr. Hwang, using the independently controllable transmission mechanisms that has a controllable output could improve the quality of generator output in Wind Turbines. In this study, the tests platform of independently controllable transmission mechanisms will be fabricated. And analysis the kinematics and dynamics by experimental results to demonstrate the feasibility in wind turbine applications of independently controllable transmission mechanisms.