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How much discretion should the monetary authority have in setting its policy? This question is analyzed in an economy with an agreed-upon social welfare function that depends on the randomly fluctuating state of the economy. The monetary authority has private information about that state. In the...
Persistent link: https://www.econbiz.de/10009639392
We introduce a specification of habit formation featuring non-separability between consumption and leisure into an otherwise standard New Keynesian model. The model can be estimated with standard Bayesian techniques and the bond pricing implications are evaluated using higher-order...
Persistent link: https://www.econbiz.de/10009405588
I analyze the impact of raising capital requirements on the quantity, composition, and riskiness of aggregate investment in a model in which firms borrow from both bank and non-bank lenders. The bank funds loans with insured deposits and costly equity, monitors borrowers, and must maintain a...
Persistent link: https://www.econbiz.de/10012224100
We model economic policy uncertainty (EPU) in the four largest euro area countries by applying machine learning …
Persistent link: https://www.econbiz.de/10012139754
In this paper we investigate the impact of the euro integration process on the drivers of FDI inflows. We show … bilateral gravity models of FDI inflows into euro area countries, we show that the euro facilitates intra-euro area vertical FDI … countries located outside the monetary union increase. Such flows are however not more likely be directed towards euro area …
Persistent link: https://www.econbiz.de/10011999066
We investigate the public-private wage differentials in ten euro area countries (Austria, Belgium, France, Germany …
Persistent link: https://www.econbiz.de/10009405597
a medium term horizon. -- Current account ; capital flows ; financial integration ; central and eastern Europe ; panel …
Persistent link: https://www.econbiz.de/10003826590
This paper presents new evidence on the importance of insolvency frameworks for private sector debt deleveraging and for the resolution of non-performing loans (NPL). We construct an aggregate insolvency framework index (IFI), which is used as explanatory variable in the empirical analysis. By...
Persistent link: https://www.econbiz.de/10011921438
The paper evaluates the impact of a phased-in introduction of capital requirements on equity, risk-taking, and probability of default for a sample of European systemically important banks. Contrary to the case of a one-off introduction of capital requirements, this study does not find evidence...
Persistent link: https://www.econbiz.de/10012251320
in time. In particular, the model would have pointed early on to emerging vulnerabilities in all the euro area countries … that registered severe recessions in the years after 2007. We also show that the model can be applied beyond the euro area …
Persistent link: https://www.econbiz.de/10012058978