address the following questions. How are macroeconomic shocks transmitted to bank risk and other banking variables? What are … the sources of bank heterogeneity, and what explains differences in individual banks' responses to macroeconomic shocks …? Our paper has two main findings: (i) Average bank risk declines, and average bank lending increases following expansionary …

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 operations is taken into account. This result suggests that a more …

types of money are created and destructed: bank deposits, when banks grant loans to firms or to other banks, and central … bank money, when the central bank grants loans to private banks. We show that symmetric equilibria yield the first …We study money creation and destruction in today's monetary architecture within a general equilibrium setting. Two …

bank's concern about the cost of financial disruption generates an asymmetric response, thus contributing to the creation … of an asset price bubble. In an economy with a highly leveraged financial structure, the central bank has an incentive to … a central bank to inject liquidity in a crisis. …

This paper proposes a novel mechanism by which changes in the distribution of money holdings have real effects … through the dependence of optimal markups on the heterogeneity of money holdings. Because varieties of consumption bundles are … purchased sequentially, newly injected money disseminates slowly throughout the economy via second-round effects. The model …

The European Central Bank (ECB) took many measures to combat the eurozone's rolling financial crisis. For providing …