Unconventional monetary policies from conventional theories: Modern lessons for central bankers
The aim of this paper is to provide a critical review of some recent developments in macroeconomics. We discuss the introduction of financial frictions in New Keynesian models, which is said to account for the increasing influence of financial markets, institutions and products in real-world economi...
| Veröffentlicht in: | 369 EGFR SIGNALING IMPAIRS THE ANTIVIRAL ACTIVITY OF INTERFERON-ALPHA. - 2013 JPMOD : a social science forum of world issues. - Amsterdam [u.a.] |
|---|---|
| 1. Verfasser: | |
| Weitere Verfasser: | |
| Format: | Online-Aufsatz |
| Sprache: | English |
| Veröffentlicht: |
2020transfer abstract
|
| Zugriff auf das übergeordnete Werk: | 369 EGFR SIGNALING IMPAIRS THE ANTIVIRAL ACTIVITY OF INTERFERON-ALPHA |
| Schlagworte: | E12 E47 E58 E17 |
| Umfang: | 17 |
| Zusammenfassung: | The aim of this paper is to provide a critical review of some recent developments in macroeconomics. We discuss the introduction of financial frictions in New Keynesian models, which is said to account for the increasing influence of financial markets, institutions and products in real-world economies. For this purpose, we compare the macro dynamics of a benchmark NCM-DSGE model with the behaviour of the same model augmented with a financial accelerator mechanism. Our simulation exercises show that the financial accelerator mechanism can be regarded as an effective, though indirect, way to account for hysteresis in potential output. A fundamental policy corollary follows that central banks should pursue financial stability, rather than price stability, and target current output growth, rather than output gap. Such an unconventional result is obtained by a simple macroeconomic amendment to an otherwise conventional NCM-DSGE model. The aim of this paper is to provide a critical review of some recent developments in macroeconomics. We discuss the introduction of financial frictions in New Keynesian models, which is said to account for the increasing influence of financial markets, institutions and products in real-world economies. For this purpose, we compare the macro dynamics of a benchmark NCM-DSGE model with the behaviour of the same model augmented with a financial accelerator mechanism. Our simulation exercises show that the financial accelerator mechanism can be regarded as an effective, though indirect, way to account for hysteresis in potential output. A fundamental policy corollary follows that central banks should pursue financial stability, rather than price stability, and target current output growth, rather than output gap. Such an unconventional result is obtained by a simple macroeconomic amendment to an otherwise conventional NCM-DSGE model. |
|---|---|
| Beschreibung: | 17 |
| DOI: | 10.1016/j.jpolmod.2020.01.001 |