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We quantify the effect of macroprudential policy in mitigating domestic and foreign shocks to a small open commodity based economy estimated on Chilean data. The model features a heterogeneous banking sector and includes financial frictions through collateralized borrowing and unsecured loans...
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bank acts to bring inflation under control, price-setting firms revise their estimates of the degree of persistence. Such … is found to influence the likelihood that firms switch from backward-looking indexation to the central bank's targets. As …
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The first five years of the flexible exchange rate and inflation targeting regime in Chile have shown positive results …
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This paper identifies Chile`s economic weaknesses and offers policy recommendations for increasing stability. Current … problems include weak international financial links, a Central Bank mandate that is ill-designed to deal with terms of trade …
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By examining the reaction functions of the Central Banks of Brazil, Chile, Colombia, Mexico, and Peru (LATAM-5) over …
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