Purpose – This paper aims to examine the controversial issue of the extent to which Federal Reserve monetary policy may have contributed to the recent housing crisis and subsequent adverse macroeconomic developments. Design/methodology/approach – The authors develop a small model that...

The primary purpose of this paper is to test the hypothesis of capital mobility reduction in the wake of the global financial crisis of 2008-2009. Through the constructed models we tested hypotheses about the long- and short-term mobility of global capital by estimating the correlation between...

The recent sovereign debt crisis in Europe, now a Eurozone crisis, has prompted a growing awareness of the disparities in the economic conditions and competitive positions of Eurozone countries. Such disparities are reflected in the accumulation of imbalances to the disadvantage of countries in...

This paper analyzes two instruments - asset-based reserve requirements put forward by Thomas Palley and asset-based capital requirements proposed by Charles Goodhart and Avinash Persaud - regarding their merits in reducing excessive asset price inflation. A theoretical framework of asset pricing...

The bargaining power of international banks is currently still very high as compared to what it was at the time of the Bretton Woods conference. As a consequence, systemic financial crises are likely to remain recurrent phenomena with large effects on macroeconomic aggregates. Mainstream...

Data on central bank independence (CBI) and implementation dates of CBI-reforms were used to investigate the relationship between CBI and a possible trade-off between inflation variability and output variability. No such trade-off was found, but there might still be stabilization gains from...

A nominal income target may provide credibility to a commitment to keep real interest rates exceptionally low, until a target output level is reached -–even if expected inflation rises in the interim–- in economies where nominal interest rates are effectively at the zero lower bound,...

Cato Institute's 31st Annual Monetary Conference — Was The Fed a Good Idea? November 14, 2013, Washington, D.C. President Charles I. Plosser proposes setting limits on the Federal Reserve so that it can better fulfill what he believes is its essential role. He considers restrictions on the...

Presented by Charles I. Plosser, President and Chief Executive Officer, Federal Reserve Bank of Philadelphia Risk Management Association, Philadelphia, PA President Charles Plosser shares his views on growth, labor markets, and inflation expectations. He also discusses why he believes it would...

We examine the behaviour of national and provincial inflation in Canada under inflation targeting to determine the extent to which the inflation targeting regime adopted by the Bank of Canada in the 1990s has anchored inflation expectations. Inflation expectations are well anchored when there...