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Financial Frictions and Optimal Monetary Policy in an Open Economy
Kolasa, Marcin - 2011
A growing number of papers have studied positive and normative implications of financial frictions in DSGE models. We contribute to this literature by studying the welfare-based monetary policy in a two-country model characterized by financial frictions, alongside a number of key features, like...
Persistent link: https://www.econbiz.de/10013125365
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Macroeconomic Adjustment to Monetary Union
Fagan, Gabriel - 2008
The move to monetary union in Europe led to convergence of interest rates among the participating countries. This was associated with notable cross-country differences in the behaviour of key macroeconomic aggregates. Compared to the low interest rate countries, former high interest rate...
Persistent link: https://www.econbiz.de/10012770251
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Passive Monetary Policy and Active Fiscal Policy in a Monetary Union
Maćkowiak, Bartosz; Schmidt, Sebastian - 2023
? How are the price levels in the member countries determined? We extend the fiscal theory of the price level to the case of …
Persistent link: https://www.econbiz.de/10014257510
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International Spillovers of Quantitative Easing
Kolasa, Marcin; Wesolowski, Grzegorz - 2021
This paper develops a two-country model with asset market segmentation to investigate the effects of quantitative easing implemented by the major central banks on a typical small open economy that follows independent monetary policy. The model is able to replicate the key empirical facts on...
Persistent link: https://www.econbiz.de/10013315413
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On the Inflation Risks Embedded in Sovereign Bond Yields
Camba-Méndez, Gonzalo - 2020
The purpose of this paper is to study the compensation for inflation risks priced in sovereign bond yields. And we do … so by modelling the time-varying dynamics of asset returns and inflation, and then estimating the cost of hedging … inflation risks from the perspective of a well diversified portfolio. This allows to disentangle the time-varying compensation …
Persistent link: https://www.econbiz.de/10012830326
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Monetary and Fiscal Policy Aspects of Indirect Tax Changes in a Monetary Union
Lipinska, Anna; von Thadden, Leopold - 2021
, on the choice of the inflation index stabilised by the central bank, and on whether the tax shift is anticipated or not …
Persistent link: https://www.econbiz.de/10013316310
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Population Ageing and Public Pension Reforms in a Small Open Economy
Nickel, Christiane; Rother, Philipp; Theophilopoulou, … - 2021
This paper aims to address the issue of public pension reforms under demographic ageing that is likely to occur in Europe over the next 50 years. Three possible scenarios are analysed in a Blanchard OLG framework. These include: i) a decrease both in public pensions and the lump sum labour...
Persistent link: https://www.econbiz.de/10013316600
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Openness and Optimal Monetary Policy
Lombardo, Giovanni - 2010
We show that the composition of imports has important implications for the optimal volatility of the exchange rate. Using input-output data for 25 countries we document substantial differences in the import and non-tradable content of final demand components, and in the role played by imported...
Persistent link: https://www.econbiz.de/10013135279
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Fiscal sustainability and public debt in an endogenous growth model
Fernández-Huertas Moraga, Jesús; Vidal, Jean-Pierre - 2004
This paper investigates fiscal sustainability in an overlapping generations economy with endogenous growth coming from human capital formation through educational spending. We assess how budgetary imbalances affect economic dynamics and the outlook for economic growth, thereby providing a...
Persistent link: https://www.econbiz.de/10011604441
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Exchange Rate Shocks and Inflation Comovement in the Euro Area
Leiva‐Leon, Danilo - 2020
This paper decomposes the time-varying effect of exogenous exchange rate shocks on euro area countries inflation into … quarters of the past six years, especially in turning point periods. Our main results indicate that headline inflation in euro … inflation this increasing sensitivity is solely reliant on a sustained surge in the degree of comovement, for energy inflation …
Persistent link: https://www.econbiz.de/10012838756