Please use this identifier to cite or link to this item:
https://hdl.handle.net/10216/71376
Author(s): | Fabio Verona Manuel Mota Freitas Martins Inês Drumond |
Title: | (Un)anticipated Monetary policy in a DSGE model with a shadow banking system (Bank of Finland Research Discussion Paper 4/2013) |
Issue Date: | 2013 |
Abstract: | Motivated by the U.S. events of the 2000s, we address whether a too low for too long interest rate policy may generate a boom-bust cycle. We simulate anticipated and unanticipated monetary policies in state-of-the-art DSGE models and in a model with bond financing via a shadow banking system, in which the bond spread is calibrated for normal and optimistic times. Our results suggest that the U.S. boom-bust was caused by the combination of (i) interest rates that were too low for too long, (ii) excessive optimism and (iii) a failure of agents to anticipate the extent of the abnormally favourable conditions. |
Subject: | Economia, Economia e gestão Economics, Economics and Business |
Scientific areas: | Ciências sociais::Economia e gestão Social sciences::Economics and Business |
URI: | https://hdl.handle.net/10216/71376 |
Document Type: | Relatório Técnico |
Rights: | openAccess |
License: | https://creativecommons.org/licenses/by-nc/4.0/ |
Appears in Collections: | FEP - Relatório Técnico |
Files in This Item:
File | Description | Size | Format | |
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40191.pdf | Bank of Finland Research Discussion Paper 4/2013 | 1.14 MB | Adobe PDF | View/Open |
This item is licensed under a Creative Commons License