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Hoerova, Marie; Monnet, Cyril; Temzelides, Ted - 2009

We study credible information transmission by a benevolent Central Bank. We consider two possibilities: direct … revelation through an announcement, versus indirect information transmission through monetary policy. These two ways of … transmitting information have very different consequences. Since the objectives of the Central Bank and those of individual …

Persistent link: https://www.econbiz.de/10011605137

Near-rational exuberance

Bullard, James; Evans, George W.; Honkapohja, Seppo - 2005

We study how the use of judgement or “add-factors” in macroeconomic forecasting may disturb the set of equilibrium outcomes when agents learn using recursive methods. We isolate conditions under which new phenomena, which we call exuberance equilibria, can exist in standard macroeconomic...

Persistent link: https://www.econbiz.de/10011604601

Optimal fiscal and monetary policy in a medium-scale macroeconomic model

Schmitt-Grohé, Stephanie; Uribe, Martín - 2006

In this paper, we study Ramsey-optimal fiscal and monetary policy in a mediumscale model of the U.S. business cycle. The model features a rich array of real and nominal rigidities that have been identified in the recent empirical literature as salient in explaining observed aggregate...

Persistent link: https://www.econbiz.de/10011604658

Run-prone banking and asset markets

Hoerova, Marie - 2007

I analyze the role that asset markets play in the performance and stability of the run-prone banking sector. Banks insure consumers against privately observed liquidity shocks. Asset market investments insure consumers against losses from bank runs. If the probability of a run is small, then...

Persistent link: https://www.econbiz.de/10011604891

Interbank lending, credit risk premia and collateral

Heider, Florian; Hoerova, Marie - 2009

We study the functioning of secured and unsecured inter-bank markets in the presence of credit risk. The model generates empirical predictions that are in line with developments during the 2007-2009 financial crises. Interest rates decouple across secured and unsecured markets following an...

Persistent link: https://www.econbiz.de/10011605153

Liquidity hoarding and interbank market spreads: the role of counterparty risk

Heider, Florian; Hoerova, Marie; Holthausen, Cornelia - 2009

banks to have private information about the risk of their assets. We show how banks’ asset risk affects funding liquidity in …

Persistent link: https://www.econbiz.de/10011605172

Money markets, collateral and monetary policy

De Fiore, Fiorella; Hoerova, Marie; Uhlig, Harald - 2019

Interbank money markets have been subject to substantial impairments in the recent decade, such as a decline in unsecured lending and substantial increases in haircuts on posted collateral. This paper seeks to understand the implications of these developments for the broader economy and monetary...

Persistent link: https://www.econbiz.de/10012142083