Deflationary shocks and monetary rules: An open-economy scenario analysis
نویسندگان
چکیده
منابع مشابه
Monetary Policy Rules for a Small Open Economy
In this paper the optimal choice of a monetary target is investigated for a small open economy that is subject to foreign monetary policy shocks. In contrast to large parts of the literature, pegging the exchange rate is never the best policy choice for the small open economy in our model. Instead, monetary targeting and, depending on the parameter combination, producer price index targeting co...
متن کاملMonetary policy and financial shocks in an empirical small open-economy DSGE model
In the aftermath of the global financial crisis in 2008, central banks across the globe reduced their policy rates by unprecedented margins. At the same time, commercial banks were increasing their lending rates in order to protect their crisis-induced fragile balance sheets. To a large extent, these opposing reactions reduced the efficacy of monetary policy in accommodating the substantial dec...
متن کاملMoney Growth Rules in an Emerging Small Open Economy with an informal sector
This paper is concerned with the saddle-path stability of monetary growth rules in a two-country two-sector dynamic stochastic general equilibrium model. Alongside standard features of emerging economies, such as a combination of producer and local currency pricing for exports, fiscal dominance and oil exports, this model also incorporates informal labour and production sectors and examines how...
متن کاملLiquidity Shocks and Optimal Monetary and Exchange Rate Policies in a Small Open Economy
This paper studies the potential for liquidity crises and their impact on the course of monetary and exchange rate policies in a microfounded general equilibrium dynamic model in the tradition of Diamond and Dybvig (1983) and Chang and Velasco (2000). We produce a small open economy pure exchange overlapping generations model with random relocation along the lines of Smith (2002). The combinati...
متن کاملSimple Monetary Policy Rules in an Open-Economy, Limited-Participation Model
The authors assess the stabilization properties of simple monetary policy rules within the context of a small open-economy model constructed around the limited-participation assumption and calibrated to salient features of the Canadian economy. By relying on limited participation as the main nominal friction that affects the artificial economy, the authors provide an important check of the robu...
متن کاملذخیره در منابع من
با ذخیره ی این منبع در منابع من، دسترسی به آن را برای استفاده های بعدی آسان تر کنید
ژورنال
عنوان ژورنال: Journal of the Japanese and International Economies
سال: 2006
ISSN: 0889-1583
DOI: 10.1016/j.jjie.2006.08.004