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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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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, investors who decide whether to rent or buy a house by simply comparing monthly rent and mortgage payments do not take into account that inflation lowers future real mortgage costs. We...
Persistent link: https://www.econbiz.de/10005067397
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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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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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Inefficient Provision of Liquidity
Hart, Oliver; Zingales, Luigi - C.E.P.R. Discussion Papers - 2011
liquidity is inefficient. The reason is that liquidity affects prices and the welfare of others, and creators do not internalize … government must restrict the creation of liquidity by the private sector. …
Persistent link: https://www.econbiz.de/10009246599
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A Model of the Consumption Response to Fiscal Stimulus Payments
Kaplan, Greg; Violante, Giovanni L - C.E.P.R. Discussion Papers - 2011
A wide body of empirical evidence, based on randomized experiments, finds that 20-40 percent of fiscal stimulus payments (e.g. tax rebates) are spent on non-durable household consumption in the quarter that they are received. We develop a structural economic model to interpret this evidence. Our...
Persistent link: https://www.econbiz.de/10009293985
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Complementing Bagehot: Illiquidity and insolvency resolution
Eijffinger, Sylvester C W; Nijskens, Rob - C.E.P.R. Discussion Papers - 2011
During the recent financial crisis, central banks have provided liquidity and governments have set up rescue programmes … bank suffering from liquidity shocks, we find that the unregulated bank keeps too much liquidity and monitors too little. A … central bank can alleviate the liquidity problem, but induces moral hazard. Therefore, we introduce an additional authority …
Persistent link: https://www.econbiz.de/10009320403
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The International Monetary System: Living with Asymmetry
Obstfeld, Maurice - C.E.P.R. Discussion Papers - 2011
system: international liquidity and exchange rate management. Despite radical changes since World War II in the market … context for liquidity and exchange rate concerns, they remain central to discussions of international macroeconomic policy … coordination. To take two prominent examples of specific (and related) coordination problems, liquidity issues are paramount in …
Persistent link: https://www.econbiz.de/10009385766