The Zero Bound on Interest Rates and Optimal Monetary Policy ¤ docx

... ξ t ), 18 The Zero Bound on Interest Rates and Optimal Monetary Policy ∗ Gauti Eggertsson International Monetary Fund Michael Woodford Princeton University June 26, 2003 Abstract We consider the consequences ... assets by the central bank from either interest- rate policy on the one hand and from fiscal policy on the other, it is important to note that...

Ngày tải lên: 29/03/2014, 13:20

... depend largely on the expectations of future policy rate as well as the current policy rate. The weight on the current policy rate is only 1 − qβ, while the weights on future policy rates sum up ... desirable degree of policy inertia by the size of the coefficient on the lagged policy rate in the case of a simple rule, and by the size of the relativ...

Ngày tải lên: 17/02/2014, 03:20

... Equation (20) shows that the derived optimal interest rate is a linear function of the economy’s state variables, t X and of the linear vector, f , which contains convolutions of the monetary ... distinct optimal monetary policy rule. As soon as the optimal monetary policy rule has been obtained, the following step consists in checking that the solutio...

Ngày tải lên: 15/03/2014, 14:20

Ngày tải lên: 01/04/2014, 15:20

... 2007–2008 The Zero Bound on Nominal Interest Rates: Implications for Monetary Policy Claude Lavoie and Stephen Murchison, Research Department • The lower bound on nominal interest rates is typically ... stuck at zero. In the final section, we draw some conclusions on the general implications of the zero bound for monetary policy in Canada. Why Are No...

Ngày tải lên: 29/03/2014, 01:20

... and hence the aggregate demand and inflation. Nonetheless, whether monetary policy actions influence the spectrum of market interest rates would inter alia depend upon the level of development ... to/from the banking system in the economy. How these interest rate actions and liquidity operations of the central banks impact the end-objectives depends on the...

Ngày tải lên: 29/03/2014, 13:20

... economic theory, the Fed focused mainly on the shortfall in aggregate demand rather than on the underlying supply constraint on credit availability. However, starting from a position where interest ... strengthening— the expansionary impact of the whole regime. Here I focus just on monetary policy, which is under the control of just one entity: the U.S. Federal R...

Ngày tải lên: 22/03/2014, 17:20

... market rates by other financial institutions. Late in the 1970s, this competition began to raise concerns about the viability of the traditional bank deposit. Further- more, the rationale for ... error of paying interest on its deposits, is therefore compelled by the necessities of its position to take the second false step and expand its operations beyond all prudent...

Ngày tải lên: 15/02/2014, 05:20

... basic macroeconomic moments (e.g., the standard deviations of consumption and inflation) and basic bond pricing moments (e.g., the means and volatilities of the yield curve slope and bond excess ... response functions of the term premium and output to a monetary policy shock and a government purchases shock, respectively. These impulse responses demonstrate that the r...

Ngày tải lên: 17/02/2014, 03:20