Credit Frictions and Optimal Monetary Policy
نویسندگان
چکیده
منابع مشابه
Liquidity, Credit Frictions, and Optimal Monetary Policy
We study optimal monetary policy in a NewMonetarist framework with banking, private liquidity, and credit frictions.We show that whenever part of the decentralized transactions are allowed to use deposit claims backed by interest-bearing assets, the optimal policy is a non-Friedman-rule liquidity trap. In contrast, the Friedman rule is optimal if there are no credit frictions, or if the economy...
متن کاملCredit frictions and optimal monetary policy, March 2009
We extend the basic (representative-household) New Keynesian [NK] model of the monetary transmission mechanism to allow for a spread between the interest rate available to savers and borrowers, that can vary for either exogenous or endogenous reasons. We find that the mere existence of a positive average spread makes little quantitative difference for the predicted effects of particular policie...
متن کاملComments on “Credit Frictions and Optimal Monetary Policy”, by Cúrdia and Woodford∗
Let me first briefly place it in the broader context of current macroeconomic research. First-generation new-Keynesian models, of the type analyzed by Woodford in his well-known book (2003), were based on a few central imperfections, namely monopolistic competition to allow for non-trivial market power and price setting, and nominal rigidities; their purpose was to show how shifts in demand cou...
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This paper studies optimal monetary policy and central bank transparency in an economy where firms set prices under informational frictions. The economy is subject to two types of shocks which determine the efficient level of output and the firms’ desired mark-up. To minimize the welfare-reducing output gap and price dispersion among the firms, the central bank controls the firms’ incentives an...
متن کاملOptimal versus realized bank credit risk and monetary policy
Standard banking theory suggests that there exists an optimal level of credit risk that yields maximum bank profit. We identify the optimal level of risk-weighted assets that maximizes banks’ returns in the full sample of US banks over the period 1996–2011. We find that this optimal level is cyclical for the average bank, being higher than the realized credit risk in relatively stable periods w...
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ژورنال
عنوان ژورنال: Journal of Monetary Economics
سال: 2016
ISSN: 0304-3932
DOI: 10.1016/j.jmoneco.2016.10.003