Discussion of ‘ External Constraints on Monetary Policy and the Financial Accelerator ’
نویسنده
چکیده
This paper is a remarkable attempt to take seriously the financial accelerator mechanism in an open economy and confront it to the data. The authors basically extend the Bernanke, Gertler, and Gilchrist (2000) model to a small open economy. The two main ingredients are financially constrained entrepreneurs, introducing a financial accelerator mechanism, and sticky prices, giving a role to monetary policy and creating real exchange rate movements. Moreover, the production and investment side are carefully modelled for quantitative evaluation. Importantly, this framework allows the authors to consider different exchange rate regimes.
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