Showing 1 - 8 of 8
The effects of monetary policy depend significantly on the capacity of the Central Bank to affect market interest rates by managing liquidity. Therefore, it comes out as an important issue to determine the degree of flexibility of lending and deposit rates to changes in policy rates. In this...
Persistent link: https://www.econbiz.de/10005328926
What are the benefits provided by a payment system? What are the tradeoffs in public versus private payment systems and in restricted versus open payments arrangements? Modern payment systems encompass a variety of institutional designs with varying degrees of counterparty protection. We develop...
Persistent link: https://www.econbiz.de/10005328947
From 1863-1914, banks in the U.S. could issue notes subject to full collateral, a per-period tax on outstanding notes, redemption of notes on demand, and a clearing fee per issued note cleared through the Treasury. The system failed to satisfy a purported arbitrage condition; i.e., the yield on...
Persistent link: https://www.econbiz.de/10005342293
We study unofficial dollarization, i.e., the use of foreign money alongside the domestic currency, in an environment where spatial separation and limited communication create a role for currency and banks arise endogenously to provide insurance against liquidity preference shocks. Unofficial...
Persistent link: https://www.econbiz.de/10005129775
From 1863-1914, banks in the U.S. could issue notes subject to full collateral, a per-period tax on outstanding notes, redemption of notes on demand, and a clearing fee per issued note cleared through the Treasury. The system failed to satisfy a purported arbitrage condition; i.e., the yield on...
Persistent link: https://www.econbiz.de/10005130205
We study unofficial dollarization, i.e., the use of foreign money alongside the domestic currency, in an environment where spatial separation and limited communication create a role for currency and banks arise endogenously to provide insurance against liquidity preference shocks. Unofficial...
Persistent link: https://www.econbiz.de/10005130227
This paper provides a tractable search model with divisible money that encompasses the two frameworks currently used in the literature. In the model, individuals belong to many villages. Inside a village, individuals are not altruistic as in a representative household, but they share information...
Persistent link: https://www.econbiz.de/10005170377
Interest rate rules for monetary policy and tax rules for fiscal policy change stochastically between two regimes. In the first regime monetary policy follows the Taylor principle and taxes rise strongly with increases in the real value of government debt; in the second regime the Taylor...
Persistent link: https://www.econbiz.de/10005702682