Offick, Sven; Wohltmann, Hans-Werner - 2014
This paper integrates a money and credit market into a static approximation of the baseline New Keynesian model based … on a money-and-credit-in-the-utility approach, in which real balances and borrowing contribute to the household’s utility … the banking sector. Our approach gives rise to a credit channel, in which current and expected future interest rates on …
