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Mortgage prepayment, race, and monetary policy
Gerardi, Kristopher; Willen, Paul; Zhang, David Hao - 2020
This paper documents large differences in mortgage prepayment behavior across racial and ethnic groups in the United States, which have significant implications for monetary policy, inequality, and pricing. Using a novel data set that combines administrative data on mortgage performance with...
Persistent link: https://www.econbiz.de/10012606346
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Fiscal policy and inflation: Understanding the role of expectations in Mexico
Lopez-Martin, Bernabe; Ramírez de Aguilar, Alberto; … - 2018
This paper estimates a hidden Markov model where inflation is determined by government deficits financed through money … inflation expectations. The estimated sequence of monetized deficits provides an adequate account of inflation for the period … 196994. The paper then extends the model to analyze the possibility that fiscal policy can affect inflation expectations in a …
Persistent link: https://www.econbiz.de/10012616363
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Fiscal expansions in the era of low real interest rates
Garga, Vaishali - 2020
Low natural real interest rates limit the power of monetary policy to revive the economy due to the zero lower bound (ZLB) on the nominal interest rate. Fiscal stabilization via higher government debt is frequently recommended as a policy to raise the natural real interest rate. This paper...
Persistent link: https://www.econbiz.de/10012606350
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Monetary policy through production networks: Evidence from the stock market
Ozdagli, Ali; Weber, Michael - 2017
Monetary policy shocks have a large impact on stock prices during narrow time windows centered around press releases by the FOMC. We use spatial autoregressions to decompose the overall effect of monetary policy shocks into a direct effect and a network effect. We attribute 50 to 85 percent of...
Persistent link: https://www.econbiz.de/10012059589
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Policy response to external shocks: Lessons from the crisis
Capistrán, Carlos; Cuadra, Gabriel; Ramos-Francia, Manuel - 2011
Emerging economies have been subject to abrupt reversals in capital inflows, which have adverse consequences for economic activity and financial stability. An important question for policymakers is how to respond to a sudden loss of external financing and its negative effects on the domestic...
Persistent link: https://www.econbiz.de/10010322619
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In the quest of macroprudential policy tools
Sámano, Daniel - 2011
The global financial crisis of late 2008 could not have provided more convincing evidence that price stability is not a sufficient condition for financial stability. In order to attain both, central banks must develop macroprudential instruments in order to prevent the occurrence of systemic...
Persistent link: https://www.econbiz.de/10010322586
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Monetary shocks and stock returns: Identification through the impossible trinity
Ozdagli, Ali K.; Yu, Yifan - 2012
This paper attempts to identify how monetary policy shocks affect stock prices by using Mundell and Fleming's theory of the Impossible Trinity. According to this theory, it is impossible to simultaneously have a fixed exchange rate, free capital movement (an absence of capital controls), and an...
Persistent link: https://www.econbiz.de/10010343349
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U.S. monetary policy and emerging market credit cycles
Bräuning, Falk; Ivashina, Victoria - 2017
Foreign banks' lending to firms in emerging market economies (EMEs) is large and denominated primarily in U.S. dollars. This creates a direct connection between U.S. monetary policy and EME credit cycles. We estimate that over a typical U.S. monetary easing cycle, EME borrowers face a...
Persistent link: https://www.econbiz.de/10012059587
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Monetary rules, financial stability and welfare in a non-Ricardian framework
Adame Espinosa, Francisco - 2023
generations to analyze a channel through which fluctuations in household financial wealth influence aggregate demand. The optimal … fluctuations while simultaneously reducing variability in inflation and the output gap. The model is calibrated for the United …, in addition to inflation and output gaps, can reproduce the welfare achieved under optimal monetary policy. However, this …
Persistent link: https://www.econbiz.de/10014541062
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Should monetary policy lean against the wind in a small-open economy? Revisiting the Tinbergen rule
2021
The frequencies at which prices and wages are adjusted, interpreted as price and wage flexibility, are key elements in workhorse models used for policy analysis. Yet, there is little evidence regarding the relationship between these two sources of nominal rigidities. Using two large and highly...
Persistent link: https://www.econbiz.de/10012616414