This paper aims to provide a comprehensive analysis of the potential conflicts between macroprudential and monetary policies within DGSE model with financial frictions. The identification is conditional on different types shocks, policy instruments, objectives. We first find that are not systematic but fairly frequent, especially in case supply-side widespread shocks such as investment efficien...

Institut International d’Economie Politique IIEP International Economic Policy Institute IEPI Institut International d’Economie Politique IIEP International Economic Policy Institute IEPI Institut International d’Economie Politique IIEP International Economic Policy Institute IEPI Institut International d’Economie Politique IIEP International Economic Policy Institute IEPI Institut Internationa...

This paper gives a brief introduction to the theory of dynamic games as developed mostly by control theorists and engineers and presents some economic applications of this theory. The paper shows how the theory of dynamic games can be applied to problems of economic policy-making with heterogeneous policy-makers, whose behavior is characterized by strategic interactions. In particular, for the ...

We propose a new model for policy analysis of banking crises (or systemic bank runs) based on the monetary framework developed by Lagos and Wright (2005). If banks cannot enforce loan repayment and have to secure loans by collateral, a banking crisis due to coordination failure among depositors can occur in response to a sunspot shock, and the banks become insolvent as a result of the bank runs...

extended distribution of digicash has commercial, socio-economic as well as political effects. from the economic viewpoint, the most crucial effect of digicash use extension takes place on money supply, monetary policies and central bank. because digicash is capable of being replaced by bank notes and the coins, it is possible that digicash gradually takes the place of the central bank money an...