This paper sets up a small open economy TANK model with constrained households to address the driving forces of business cycles in Korea. The estimated model via Bayesian methodology shows that nearly half of households have lacked access to financial markets before the Asian financial crisis....

We study spillover of monetary policy uncertainty shock from the US to other economies with different exchange rate regimes. A surge of monetary policy uncertainty in the US incurs contractionary consequences in other economies and decreases output, consumption, and stock market prices. Such...

This paper sets up a small open economy TANK model with constrained households to address the driving forces of business cycles in Korea. The estimated model via Bayesian methodology shows that nearly half of households have lacked access to financial markets before the Asian financial crisis....

This paper sets up a two agent small open economy with monopolistically competitive firms and catching up with the Joneses to investigate the labor and capital Laffer curve, taking into account aging population along the line of Auray et al. (2016), Gali and Monacelli (2005), and Trabandt and...

In this paper, we address how the monetary authority should react to financial market status and exchange rates movements in a small open economy New Keynesian model with financial frictions due to asymmetric information between savers and borrowers. We show that the small economy with financial...

This paper sets up a canonical new Keynesian small open economy model with nominal price rigidities to explore the impact of habit persistence and exchange rate pass-through on the welfare ranking of alternative monetary policy rules. It identifies three factors that can affect the welfare...

This paper investigates sources of business cycles in Korea to shed some lights on the effects of economic crisis and the role of financial frictions. For this purpose, it sets up a canonical international real business cycle model augmented by international financial market frictions as in...