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Channel Systems : Why is There a Positive Spread?
Berentsen, Aleksander - 2010
An increasing number of central banks implement monetary policy via two standing facilities: a lending facility and a deposit facility. In this paper we show that it is socially optimal to implement a non-zero interest rate spread. We prove this result in a dynamic general equilibrium model...
Persistent link: https://www.econbiz.de/10013135781
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The Role of Monetary Aggregates in the Policy Analysis of the Swiss National Bank
Kirchgässner, Gebhard - 2013
quantity of money and or excess money can be used to forecast inflation. After a preliminary data analysis, money demand …. Using recursive estimates, indicator properties of monetary aggregates for inflation are assessed for the period from 2000 … the one for M2 is strongly influenced by these three observations. While in both cases forecasts for 2010 show inflation …
Persistent link: https://www.econbiz.de/10013095154
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Liquidity Shortages and Monetary Policy
Cao, Jin; Illing, Gerhard - 2021
The paper models the interaction between risk taking in the financial sector and central bank policy for the case of pure illiquidity risk. It is shown that, when bad states are highly unlikely, public provision of liquidity may improve the allocation, even though it encourages more risk taking...
Persistent link: https://www.econbiz.de/10013316591
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Superneutrality of Money Under Open Market Operations
Homburg, Stefan - 2015
Monetary policy is superneutral in an overlapping generations model. Previous authors have argued that superneutrality does not hold in such a setting. However, the standard results rely on the counter-factual premise of helicopter money and are overturned if money creation through open market...
Persistent link: https://www.econbiz.de/10013026679
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The Relevance or Otherwise of the Central Bank's Balance Sheet
Miles, David - 2014
This paper explores the impacts on an economy of a central bank changing the size and composition of its balance sheet. One of the ways in which such asset purchases could influence prices and demand is via portfolio balance effects. We develop and calibrate a simple OLG model in which...
Persistent link: https://www.econbiz.de/10013058499
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Money Overhang, Credit Overhang and Financial Imbalances in the Euro Area
Kool, Clemens J.M. - 2013
This paper focuses on the relation between external imbalances and domestic money and credit growth in the euro area. We compute money and credit overhang both for the euro area as a whole and for individual member countries. Our results show that both aggregate money and credit overhang have...
Persistent link: https://www.econbiz.de/10013072508
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Vote Buying or (Political) Business (Cycles) as Usual?
Aidt, Toke Skovsgaard; Asatryan, Zareh; Badalyan, Lusine; … - 2021
We study the short-run effect of elections on monetary aggregates in a sample of 85 low and middle income democracies (1975-2009). We find an increase in the growth rate of M1 during election months of about one tenth of a standard deviation. A similar effect can neither be detected in...
Persistent link: https://www.econbiz.de/10013315531
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Multiple Objectives and Central Bank Tradeoffs Under Flexible Inflation Targeting
Walsh, Carl E. - 2014
Many inflation targeting central banks are facing calls to expand their list of policy goals. I discuss how recent …
Persistent link: https://www.econbiz.de/10013040478
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Inflation Targeting by Debtor Central Banks in Emerging Market Economies
Loeffler, Axel - 2013
stability. To contain domestic inflation these central banks absorb rather then provide liquidity in their regular monetary … policy operations. Based on an augmented Barro-Gordon framework we show that inflation targeting within an environment of … implementing sterilization costs into the central bank's objective function the inflation bias increases …
Persistent link: https://www.econbiz.de/10013094452
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The Impact of Monetary Strategies on Inflation Persistence
Kočenda, Evžen - 2017
We analyze the impact of price stability-oriented monetary strategies (inflation targeting — IT — and constraining … exchange rate arrangements) on inflation persistence using a time-varying coefficients framework in a panel of 68 countries … (1993–2013). We show that explicit IT has a stronger effect on taming inflation persistence than implicit IT and is …
Persistent link: https://www.econbiz.de/10012962672