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Saving and learning: Theory and evidence from saving for child's college
Zhu, Junyi - Deutsche Bundesbank - 2012
This paper analyzes the main uncertainty of college saving - the child's ability - in the context of the saving with learning model. The first section develops a dynamic model combining asset accumulation and learning to explain the parents' forward-looking saving behavior when they are...
Persistent link: https://www.econbiz.de/10010957083
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Exchange rate dynamics, expectations, and monetary policy
Chen, Qianying - Deutsche Bundesbank - 2011
This paper re-investigates the implications of monetary policy rules on changes in exchange rate, in a risk-adjusted, uncovered interest parity model with unrestricted parameters, emphasizing the importance of modeling market expectations of monetary policy. I use consensus forecasts as a proxy...
Persistent link: https://www.econbiz.de/10009283654
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Heterogeneity in money holdings across euro area countries: The role of housing
Setzer, Ralph; van den Noord, Paul; Wolff, Guntram B. - Deutsche Bundesbank - 2010
inception of the euro. We derive a money demand equation that incorporates housing wealth and collateral as well as substitution … effects on real money holdings. Empirically, we show that cross-country differences in real balances are determined not only … by income differences, a standard determinant of money demand, but also by house price developments. Higher house prices …
Persistent link: https://www.econbiz.de/10008509091
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Learning about fiscal policy and the effects of policy uncertainty
Hollmayr, Josef; Matthes, Christian - Deutsche Bundesbank - 2013
The recent crisis in the United States has often been associated with substantial amounts of policy uncertainty. In this paper we ask how uncertainty about fiscal policy affects the impact of fiscal policy changes on the economy when the government tries to counteract a deep recession. The...
Persistent link: https://www.econbiz.de/10010957088
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Trend growth expectations and US house prices before and after the crisis
Hoffmann, Mathias; Krause, Michael U.; Laubach, Thomas - Deutsche Bundesbank - 2012
We provide an analysis that might help distinguish rationally justified movements in house prices from potentially non-rational movements, using a two-sector business cycle model, in which investment in housing is subject to collateral constraints. A large portion of the evolution of U.S. house...
Persistent link: https://www.econbiz.de/10010957113
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Persuasion by stress testing: Optimal disclosure of supervisory information in the banking sector
Gick, Wolfgang; Pausch, Thilo - Deutsche Bundesbank - 2012
The game-theoretical analysis of this paper shows that stress tests that cover the entire banking sector (macro stress tests) can be performed by institutional supervisors to improve welfare. In a multi-receiver framework of Bayesian persuasion we show that a banking authority can create value...
Persistent link: https://www.econbiz.de/10010957114
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The expectations-driven US current account
Hoffmann, Mathias; Krause, Michael U.; Laubach, Thomas - Deutsche Bundesbank - 2013
Since 1991, survey expectations of long-run output growth for the U.S. relative to the rest of the world exhibit a pattern strikingly similar to that of the U.S. current account, and thus also to global imbalances. We show that this finding can to a large extent be rationalized in a two-region...
Persistent link: https://www.econbiz.de/10010957136
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Knowledge sourcing: legitimacy deficits for MNC subsidiaries?
Schmidt, Tobias; Sofka, Wolfgang - Deutsche Bundesbank - 2009
Multinational corporations (MNC) search increasingly for lead market knowledge and technological expertise around the …
Persistent link: https://www.econbiz.de/10005083060
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Genetic learning as an explanation of stylized facts of foreign exchange markets
Lux, Thomas; Schornstein, Sascha - Deutsche Bundesbank - 2002
This paper revisits the Kareken-Wallace model of exchange rate formation in a two-country overlapping generations world. Following the seminal paper by Arifovic (Journal of Political Economy, 104, 1996, 510-541) we investigate a dynamic version of the model in which agents' decision rules are...
Persistent link: https://www.econbiz.de/10005083146
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Long-run growth expectations and 'global imbalances'
Hoffmann, Mathias; Krause, Michael; Laubach, Thomas - Deutsche Bundesbank - 2011
This paper examines to what extent the build-up of 'global imbalances' since the mid-1990s can be explained in a purely real open-economy DSGE model in which agents' perceptions of long-run growth are based on filtering observed changes in productivity. We show that long-run growth estimates...
Persistent link: https://www.econbiz.de/10009643167