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Changes in monetary regimes and the identification of monetary policy shocks : narrative evidence from Canada

Champagne, Julien; Sekkel, Rodrigo - 2017

We use narrative evidence along with a novel database of real-time data and forecasts from the Bank of Canada's staff economic projections from 1974 to 2015 to construct a new measure of monetary policy shocks and estimate the effects of monetary policy in Canada. We show that it is crucial to...

Persistent link: https://www.econbiz.de/10011777945

Inflation, output, and welfare in the laboratory

Jiang, Janet Hua; Puzzello, Daniela; Zhang, Cathy - 2023 - Last updated: February 13, 2023

We develop an experimental framework to investigate the quantity theory of money and the real effects of inflation in … an economy where money serves as a medium of exchange. We test the classical view that inflation reduces output and … welfare by taxing monetary exchange. Inflation is engineered by constant money growth. We conduct three treatments, where the …

Persistent link: https://www.econbiz.de/10013542097

Decision synthesis in monetary policy

Chernis, Tony; Koop, Gary; Tallman, Emily; West, Mike - 2024 - Last updated: August 16, 2024

The macroeconomy is a complicated dynamic system with significant uncertainties that make modelling difficult. Consequently, decision-makers consider multiple models that provide different predictions and policy recommendations and then synthesize that information into a policy decision. We use...

Persistent link: https://www.econbiz.de/10015067158

The welfare implications of fiscal dominance

De Resende, Carlos (contributor); Rebei, Nooman (contributor) - 2008

This paper studies the interdependence between fiscal and monetary policy in a DSGE model with sticky prices and non-zero trend inflation. We characterize the fiscal and monetary policies by a rule whereby a given fraction k of the government debt must be backed by the discounted value of...

Persistent link: https://www.econbiz.de/10003772978

Macroeconomic determinants of the term structure of corporate spreads

Yang, Jun (contributor) - 2008

We investigate the macroeconomic determinants of corporate spreads using a no-arbitrage technique. Structural shocks are identified by a New-Keynesian model. Treasury bonds are priced in an affine model with time-varying risk premia. Corporate bonds are priced in a reduced-form credit risk model...

Persistent link: https://www.econbiz.de/10003772980

Aggregate and welfare effects of redistribution of wealth under inflation and price-level targeting

Meh, Césaire Assah (contributor); … - 2008

Since the work of Doepke and Schneider (2006a) and Meh and Terajima (2008), we know that inflation causes major redistribution of wealth between households and the government, between nationals and foreigners, and between households within the same country. Two types of monetary policy,...

Persistent link: https://www.econbiz.de/10003773003

The role of bank capital in the propagation of shocks

Meh, Césaire Assah (contributor); Moran, Kevin (contributor) - 2008

Recent events in financial markets have underlined the importance of analyzing the link between the financial health of banks and real economic activity. This paper contributes to this analysis by constructing a dynamic general equilibrium model in which the balance sheet of banks affects the...

Persistent link: https://www.econbiz.de/10003773059

McCallum rules, exchange rates, and the term structure of interest rates

Díez de los Ríos, Antonio (contributor) - 2008

McCallum (1994a) proposes a monetary rule where policymakers have some tendency to resist rapid changes in exchange rates to explain the forward premium puzzle. We estimate this monetary policy reaction function within the framework of an affine term structure model to find that, contrary to...

Persistent link: https://www.econbiz.de/10003775749

Financial intermediation, liquidity and inflation

Chiu, Jonathan (contributor); … - 2008

This paper develops a search-theoretic model to study the interaction between banking and monetary policy and how this interaction affects the allocation and welfare. Regarding how banking affects the welfare costs of inflation: First, we find that, with banking, inflation generates smaller...

Persistent link: https://www.econbiz.de/10003790575

Monetary policy lag, zero lower bound, and inflation targeting

Nishiyama, Shin-Ichi (contributor) - 2009

Although the concept of monetary policy lag has historical roots deep in the monetary economics literature, relatively little attention has been paid to the idea. In this paper, we build on Svensson's (1997) inflation targeting framework by explicitly taking into account the lagged effect of...

Persistent link: https://www.econbiz.de/10003790614

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