Showing 1 - 9 of 9
Persistent link: https://www.econbiz.de/10005248348
This paper develops a dynamic general equilibrium model that is intended to help clarify the role of credit market frictions in business fluctuations, from both a qualitative and a quantitative standpoint. The model is a synthesis of the leading approaches in the literature. In particular, the...
Persistent link: https://www.econbiz.de/10005264309
Macroeconomic shocks such as wil price increases induce a systematic (endogenous) response of monetary policy. We develop a VAR-based technique for decomposing the total economic effects of a given exogenous shock into the portion attributable directly to the shock and the part arising from the...
Persistent link: https://www.econbiz.de/10005826730
We argue that allowing for the possibility of a self-fulfilling panic helps understand several features of the recent Mexican crisis. Self-fulfilling expectations became decisive in generating a panic only after the government ran down gross reserves and ran up short-term dollar debt. We present...
Persistent link: https://www.econbiz.de/10005826876
In this paper, we characterize conditions under which interest rate feedback rules wherby the nominal interest rate is set as an increasing function of the inflation rate generate multiple equilibria. We show that these conditions depend not only on the fiscal regime (as emphasized in the fiscal...
Persistent link: https://www.econbiz.de/10005168647
We present a simple model that can account for the main features of recent financial crises in emerging markets. The international illiquidity of the domestic financial system is at the center of the problem. Illiquid banks are a necessary and a sufficient condition for financial crises to...
Persistent link: https://www.econbiz.de/10005605574
Most authors have attributed the real effects of money in the short run either to mistaken expectations or to non-market clearing or both. In this paper we argue that neither of these channels is needed to explain the facts. We show that a competitive market clearing model in which money enters...
Persistent link: https://www.econbiz.de/10005605583
This paper analyzes German monetary policy in the post-Bretton Woods era.
Persistent link: https://www.econbiz.de/10005605598
We estimate a forward-looking monetary policy reaction function for the postwar U.S. economy, pre- and post-October 1979. Our results point to substantial differences in the estimated rule across periods. In particular, interest rate policy in the Volcker-Greenspan period appears to have been...
Persistent link: https://www.econbiz.de/10005611736