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Monetary transmission in low income countries
Mishra, Prachi; Montiel, Peter J; Spilimbergo, Antonio - C.E.P.R. Discussion Papers - 2010
This paper reviews the monetary transmission mechanism in low income countries (LICs). We use monetary transmission in advanced and emerging markets as a benchmark to identify aspects of the transmission mechanism that may operate differently in LICs. In particular, we focus on the effects of...
Persistent link: https://www.econbiz.de/10008466328
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Explaining Forward Exchange Bias .... Intra-day
Lyons, Richard K; Rose, Andrew K - C.E.P.R. Discussion Papers - 1994
Intra-day interest rates are zero. Consequently, a foreign exchange dealer can short a vulnerable currency in the morning, close this position in the afternoon, and never face an interest cost. This tactic might seem especially attractive in times of crisis, since it suggests an immunity to the...
Persistent link: https://www.econbiz.de/10005124023
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Money Illusion and Housing Frenzies
Brunnermeier, Markus K; Julliard, Christian - C.E.P.R. Discussion Papers - 2007
A reduction in inflation can fuel run-ups in housing prices if people suffer from money illusion. For example … account that inflation lowers future real mortgage costs. We decompose the price-rent ratio in a rational component — meant to … capture the proxy effect and risk premia — and an implied mispricing. We find that inflation and nominal interest rates …
Persistent link: https://www.econbiz.de/10005067397
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Monetary Policy in an Open Economy: The Differential Impact on Exporting and Non-Exporting Firms
Ber, Hedva; Blass, Asher; Yosha, Oved - C.E.P.R. Discussion Papers - 2002
Using firm-level data, we provide evidence that, although monetary policy affects real investment, the effect operates differentially: the greater its export intensity the less a firm is affected by tight money. We examine several interpretations and conclude that the impact is transmitted...
Persistent link: https://www.econbiz.de/10005504673
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The Wealth-Consumption Ratio
Lustig, Hanno; van Nieuwerburgh, Stijn; Verdelhan, Adrien - C.E.P.R. Discussion Papers - 2012
We derive new estimates of total wealth, the returns on total wealth, and the wealth effect on consumption. We estimate the prices of aggregate risk from bond yields and stock returns using a no-arbitrage model. Using these risk prices, we compute total wealth as the price of a claim to...
Persistent link: https://www.econbiz.de/10011083953
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What Calls to ARMs? International Evidence on Interest Rates and the Choice of Adjustable Rate Mortgages
Badarinza, Cristian; Campbell, John Y; Ramadorai, Tarun - C.E.P.R. Discussion Papers - 2014
The relative popularity of adjustable-rate mortgages (ARMs) and fixed-rate mortgages (FRMs) varies considerably both across countries and over time. We ask how movements in current and expected future interest rates affect the share of ARMs in total mortgage issuance. Using a nine-country panel...
Persistent link: https://www.econbiz.de/10011084239
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Unemployment and Inflation in Ireland: 1926-2012
Gerlach, Stefan; Lydon, Reamonn; Stuart, Rebecca - C.E.P.R. Discussion Papers - 2015
We study the determination of Irish inflation between 1926 and 2012. The difference between unemployment and the NAIRU … is a significant determinant of inflation in a simple backward-looking Phillips Curve that incorporates import prices …
Persistent link: https://www.econbiz.de/10011272719
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Animal Spirits, Persistent Unemployment and the Belief Function
Farmer, Roger E A - C.E.P.R. Discussion Papers - 2010
This paper presents a theory of the monetary transmission mechanism in a monetary version of Farmer’s (2009) model in which there are multiple equilibrium unemployment rates. The model has two equations in common with the new-Keynesian model; the optimizing IS curve and the policy rule. It...
Persistent link: https://www.econbiz.de/10008692320
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Delegating Optimal Monetary Policy Inertia
Bilbiie, Florin Ovidiu - C.E.P.R. Discussion Papers - 2009
regimes that are nested within this framework: inflation, output-gap growth and nominal income growth targeting; and inflation …
Persistent link: https://www.econbiz.de/10008459765
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The Term Structure of Inflation Expectations
Chernov, Mikhail; Mueller, Philippe - C.E.P.R. Discussion Papers - 2008
We use evidence from the term structure of inflation expectations implicit in the nominal yields and survey forecasts … of inflation to address the question of whether or not monetary policy is effective. We construct a model that …-neutral, subjective, and objective probability measures. We extract private sector expectations of inflation from this model and establish …
Persistent link: https://www.econbiz.de/10005662095