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| Registros recuperados: 10 | |
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| Farhi, Emmanuel; Tirole, Jean. |
| The paper elicits a mechanism by which private leverage choices exhibit strategic complementarities through the reaction of monetary policy. When everyone engages in maturity transformation, authorities have little choice but facilitating refinancing. In turn, refusing to adopt a risky balance sheet lowers the return on equity. The key ingredient is that monetary policy is non-targeted. The ex post benefits from a monetary bailout accrue in proportion to the number amount of leverage, while the distortion costs are to a large extent fixed. This insight has important consequences. First, banks choose to correlate their risk exposures. Second, private borrowers may deliberately choose to increase their interest-rate sensitivity following bad news about... |
| Tipo: Working or Discussion Paper |
Palavras-chave: Monetary Policy; Funding Liquidity Risk; Strategic Complementarities; Macro-Prudential Supervision; Financial Economics; E44; E52; G28. |
| Ano: 2009 |
URL: http://purl.umn.edu/52545 |
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| Feldkord, Eva-Ulrike. |
| This paper develops a business cycle model with a financial intermediation sector. Financial wealth is defined as a predetermined state variable. Both, the additional sector of financial intermediaries and predetermination of financial wealth, affect the demand for real financial wealth. If real financial wealth also enters the monetary policy rule, the conditions for stability and uniqueness of the macroeconomic equilibrium path change fundamentally compared to standard New Keynesian business cycle models. Here, real financial wealth is interpreted as a real broad monetary aggregate. Furthermore, different interest rate rules and their consequences for stability and uniqueness of the macroeconomic equilibrium path are considered. Two monetary policy rules... |
| Tipo: Working or Discussion Paper |
Palavras-chave: Broad money; Macroeconomic stability; Monetary policy.; Financial Economics; E41; E51; E52. |
| Ano: 2005 |
URL: http://purl.umn.edu/26343 |
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| Tirole, Jean. |
| The recent crisis was characterized by massive illiquidity. This paper reviews what we know and don't know about illiquidity and all its friends: market freezes, fire sales, contagion, and ultimately insolvencies and bailouts. It first explains why liquidity cannot easily be apprehended through a single statistics, and asks whether liquidity should be regulated given that a capital adequacy requirement is already in place. The paper then analyzes market breakdowns due to either adverse selection or shortages of financial muscle, and explains why such breakdowns are endogenous to balance sheet choices and to information acquisition. It then looks at what economics can contribute to the debate on systemic risk and its containment. Finally, the paper takes a... |
| Tipo: Working or Discussion Paper |
Palavras-chave: Liquidity; Contagion; Bailouts; Regulation; Financial Economics; E44; E52; G28. |
| Ano: 2010 |
URL: http://purl.umn.edu/91011 |
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| Choudhry, Taufiq. |
| This paper investigates the monetary interdependence and the money-income relationship between countries under a pegged and a floating exchange rate system during the same time period (1979-1997). The relationship is tested between three ERM countries, France, Germany and Holland, and also between these countries and the United States. The ERM countries have a pegged exchange rate between themselves, and the rate between these countries and the United States is freely floating. The empirical tests are conducted by means of the Johansen multivariate cointegration method and the error correction model. Among the ERM countries, international transmission of monetary policy is found in almost all directions. This may provide evidence against the theory of... |
| Tipo: Journal Article |
Palavras-chave: Monetary policy; Cointegration; Error correction; Speed of adjustment; Exchange rate; Public Economics; E50; E52. |
| Ano: 2002 |
URL: http://purl.umn.edu/44428 |
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| Hudgins, David; Shuai, Jie. |
| Although high productivity growth is a primary economic goal across nations, it can lead to short run adjustment problems when it temporarily achieves high levels. This may induce a jobless recovery when labor productivity is high while an economy is experiencing sluggish growth or a recession. This paper creates a framework for empirically modeling these effects. This model is used in the context of an optimal control framework in order to derive policy rules for guiding monetary policy during such episodes. |
| Tipo: Journal Article |
Palavras-chave: Monetary policy rules; Productivity gains; Financial Economics; E52; E61; E65. |
| Ano: 2006 |
URL: http://purl.umn.edu/50147 |
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| Sin, Lew Yuen; Asam Tuan Lorik, Ku. |
| Intra-trade among ASEAN countries have remained around 20% over the period 1993 until 2001 (ASEAN Secretariat). With this significant amount of trade being conducted between members of ASEAN countries, businesses were faced with exchange rate exposure due to the volatility of the exchange rate within the regions as was experienced during the Asian Financial Crisis of 1997-98. Members of the European Union overcome this exchange rate exposure by agreeing to form a monetary union and adopting Euro as their common currency in 1999. This paper examines the feasibility of a Optimum Currency Area (OCA) for ASEAN 9 to adopt a common currency, especially after the 1997-98 Asian Financial Crisis. Using macro-economic data for 9 ASEAN countries over the 15 years... |
| Tipo: Journal Article |
Palavras-chave: Monetary union; Optimum currency area; SVAR; Financial Economics; E52; F31; F36. |
| Ano: 2006 |
URL: http://purl.umn.edu/50151 |
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| Yildirim, Julide. |
| The high degree of economic integration has led to an increased degree of currency substitution in the EU countries, which could bring instability in national money demand functions while an EU-wide money demand function could be more stable. Currency substitution usually takes the form of cross border deposits (CBD), which are not included in the traditional monetary aggregates. Thus, extended monetary aggregates that include the relevant CBDs are defined in this study. In order to investigate the implications of currency substitution for the stability of the demand functions, the traditional and extended monetary aggregates for five EU countries are defined in addition to EU-wide monetary aggregates. The estimated EU-wide demand for extended money... |
| Tipo: Journal Article |
Palavras-chave: Currency substitution; Cross border deposits; Extended monetary aggregates; Demand for money; Vector autoregression; Financial Economics; E41; F33; E52; E47. |
| Ano: 2003 |
URL: http://purl.umn.edu/43999 |
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| Drazen, Allan. |
| Is there a fundamental conflict between insulating monetary policy from popular pressures, seen as essential to sound monetary policy, and making policy responsive to the popular will, seen as fundamental to democracy? We argue that strongly independent monetary policy is not inconsistent with democratic control of policymaking, once one realizes that a key feature of democratic policymaking is the decision to remove some decisions from “day-to-day” political pressures. This is the essence of "constitutionalism," central to the functioning of democracy, by which certain decisions are made difficult to reverse. It is further argued that a conflict between popular sovereignty and policymaker independence is not unique to monetary policy, but actually... |
| Tipo: Journal Article |
Palavras-chave: Central bank independence; Constitutional democracy; Democratic control; Financial Economics; E52; E58; H62. |
| Ano: 2002 |
URL: http://purl.umn.edu/44297 |
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| Registros recuperados: 10 | |
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