The resurgence of interest in currency boards prompts reconsideration of one of the Irish experience. The authors evaluate the institutional arrangements which underpinned the Irish pound for a half-century. While the regime did have a credibility which led to low interest rates and a degree of...

The resurgence of interest in currency boards prompts reconsideration of one of the Irish experience. The authors evaluate the institutional arrangements which underpinned the Irish pound for a half-century. While the regime did have a credibility which led to low interest rates and a degree of...

Contemporary views often support the idea that a high level of central bank independence, together with a clear mandate for it to restrain inflation, are important institutional devices for maintaining price stability. The meaning and policy implications of central bank independence are...

In the general context of controlling inflation, it is suggested that it may be useful to look back at how demand management worked in a small open economy. Trinidad and Tobago established a central bank in the middle of the 1960s and achieved some noteworthy initial successes with the new...

In the general context of controlling inflation, it is suggested that it may be useful to look back at how demand management worked in a small open economy. Trinidad and Tobago established a central bank in the middle of the 1960s and achieved some noteworthy initial successes with the new...

We propose a regulatory approach for restricting debt financing as an amplification mechanism across the financial system. A small stylised model illustrates the trade-off between static and time varying limits on leverage in dampening the financial cycle. The policy section proposes its...

We build a general equilibrium model with financial frictions that impede the effectiveness of monetary policy in stimulating output. Agents with heterogeneous productivity can increase investment by levering up, but this increases interim liquidity risk. In equilibrium, the more productive...

We employ a model of leverage-induced explosive behavior in financial markets to develop a measure of financial market instability. Specifically, we derive a quantitative condition for how large levered investors can become relative to the whole market before the demand curve for securities...

This paper studies access regulation to international large-value payment systems when banking supervision is national task. We focus on the choice between net settlement or imposing real time gross settlement. As a novel feature, the communication between the supervisors is endogenized. It is...

We analyse the distribution of the TARGET cross-border interbank payment flows, from both a cross-section and time series point of view, using average daily data for the period 1999-2002. We find out that first, “location matters”, in the sense that bilateral payment flows seem to reflect an...