IS-LM
... 1973–1974 oil price shock (though it did during the 1979–1980 shock) • It could be that people expected the 1973–1974 oil price shock to be permanent • In that case the real interest rate would not necessarily rise • If so, people’s expectations were correct, since the 1973–1974 shock seems to have ...
... 1973–1974 oil price shock (though it did during the 1979–1980 shock) • It could be that people expected the 1973–1974 oil price shock to be permanent • In that case the real interest rate would not necessarily rise • If so, people’s expectations were correct, since the 1973–1974 shock seems to have ...
Comprehensive Assessment: Developments in Economic Activity
... output gap. (5) The improvement in the output gap, together with rising inflation expectations, would push up the observed inflation rate. (6) Once people experienced an actual rise in the inflation rate, they would adapt their inflation expectations, resulting in higher inflation expectations and f ...
... output gap. (5) The improvement in the output gap, together with rising inflation expectations, would push up the observed inflation rate. (6) Once people experienced an actual rise in the inflation rate, they would adapt their inflation expectations, resulting in higher inflation expectations and f ...
The Transmission of Monetary Policy Operations through
... impact of labour frictions due to search and matching and wage rigidities.) The inclusion of durable goods is motivated by the empirical …nding that the response of economic activity is primarily driven by the response of the durable-good sector (i.e., durable goods, residential and business investm ...
... impact of labour frictions due to search and matching and wage rigidities.) The inclusion of durable goods is motivated by the empirical …nding that the response of economic activity is primarily driven by the response of the durable-good sector (i.e., durable goods, residential and business investm ...
Eurosystem Monetary Targeting: Lessons from U.S. Data ¤ Glenn D. Rudebusch
... general characterization, central bankers typically hold the view that movements in the monetary aggregates play essentially no role in the direct quarter-by-quarter determination of either output or prices; however, a sizable fraction also concedes that money may have some value as an indicator of ...
... general characterization, central bankers typically hold the view that movements in the monetary aggregates play essentially no role in the direct quarter-by-quarter determination of either output or prices; however, a sizable fraction also concedes that money may have some value as an indicator of ...
the attractiveness of 66 countries
... real estate market’s investment activity. For example, it is difficult to predict whether the real estate market activity in a country with a high investor protection level is more affected by the liquidity of the national stock market or by regulatory limitations. While the influence of some factor ...
... real estate market’s investment activity. For example, it is difficult to predict whether the real estate market activity in a country with a high investor protection level is more affected by the liquidity of the national stock market or by regulatory limitations. While the influence of some factor ...
Preparing for inflation - Charles Schwab Bank Collective Trust Funds
... believe is not always offset by improved returns. Approximately one-third of the time, investors would have been better off investing in several other asset classes, instead. In fact, equities and fixed income securities generally would have provided a more balanced solution—a particularly important ...
... believe is not always offset by improved returns. Approximately one-third of the time, investors would have been better off investing in several other asset classes, instead. In fact, equities and fixed income securities generally would have provided a more balanced solution—a particularly important ...
1 - Whitman People
... Using the money market model, graphically illustrate the relationship among income changes, the demand for money, and the changes in the rate of interest. Summarize the relationship among the level of income (Y), the demand for money (Md), and the rate of interest (r). As illustrated in the followin ...
... Using the money market model, graphically illustrate the relationship among income changes, the demand for money, and the changes in the rate of interest. Summarize the relationship among the level of income (Y), the demand for money (Md), and the rate of interest (r). As illustrated in the followin ...
Intra-national Purchasing Power Parity and Balassa
... pegged to those in the tradable one (possibly due to competition among labour groups). Under these circumstances, inflation will rise due to an acceleration of price growth in the non-tradable sector. This paper focuses on the issues above by exploiting a dataset of metropolitan areas, that is a dat ...
... pegged to those in the tradable one (possibly due to competition among labour groups). Under these circumstances, inflation will rise due to an acceleration of price growth in the non-tradable sector. This paper focuses on the issues above by exploiting a dataset of metropolitan areas, that is a dat ...
The Case for a Long-Run Inflation Target of Four Percent
... reached by the nominal and real federal funds rates. We can divide the recessions in Table 1 into two groups: Recessions with Low Initial Inflation Three recessions began with the inflation rate between two and three percent. These episodes provide the most direct evidence on the zero-bound problem ...
... reached by the nominal and real federal funds rates. We can divide the recessions in Table 1 into two groups: Recessions with Low Initial Inflation Three recessions began with the inflation rate between two and three percent. These episodes provide the most direct evidence on the zero-bound problem ...
Money and the Transmission Mechanism in the Optimizing IS
... spending behavior in terms of financial variables; and a money demand equation relating the real quantity of money demanded to scale and opportunity-cost variables. This definition is sufficiently strict to rule out many macroeconomic systems. True, as Brunner and Meltzer (1993, p. 78) note, “[a]ny ...
... spending behavior in terms of financial variables; and a money demand equation relating the real quantity of money demanded to scale and opportunity-cost variables. This definition is sufficiently strict to rule out many macroeconomic systems. True, as Brunner and Meltzer (1993, p. 78) note, “[a]ny ...
Economics of Money, Banking, and Financial Markets, 8e
... 27) Explain the Keynesian theory of money demand. What motives did Keynes think determined money demand? What are the two reasons why Keynes thought velocity could not be treated as a constant? Answer: Keynes believed the demand for money depended on income and interest rates. Money was held to faci ...
... 27) Explain the Keynesian theory of money demand. What motives did Keynes think determined money demand? What are the two reasons why Keynes thought velocity could not be treated as a constant? Answer: Keynes believed the demand for money depended on income and interest rates. Money was held to faci ...
Decomposing Sources of Inflation
... instabilities. For example, surges in oil price, wage, and agricultural product price can lead to surges in inflation. This type of instability does not last long, and the monetary policy should not aim to tackle temporary instabilities. Reacting to short term fluctuations would create excessive vol ...
... instabilities. For example, surges in oil price, wage, and agricultural product price can lead to surges in inflation. This type of instability does not last long, and the monetary policy should not aim to tackle temporary instabilities. Reacting to short term fluctuations would create excessive vol ...
A Quantitative Model of Banking Industry Dynamics
... There is a vast empirical literature that takes up the “concentration-stability” versus “concentration-fragility” debate. For example, Beck, Demirguc-Kunt, and Levine [6] run probit regressions where the probability of a crisis depends on banking industry concentration as well as a set of controls. ...
... There is a vast empirical literature that takes up the “concentration-stability” versus “concentration-fragility” debate. For example, Beck, Demirguc-Kunt, and Levine [6] run probit regressions where the probability of a crisis depends on banking industry concentration as well as a set of controls. ...
Economics of Money, Banking, and Financial Markets, 8e
... constant, a continually increasing money supply causes A) aggregate demand to increase along a stationary aggregate supply curve, leading to continually increasing aggregate output and prices. B) aggregate supply to decrease along a stationary aggregate demand curve, leading to continually contracti ...
... constant, a continually increasing money supply causes A) aggregate demand to increase along a stationary aggregate supply curve, leading to continually increasing aggregate output and prices. B) aggregate supply to decrease along a stationary aggregate demand curve, leading to continually contracti ...
Terms-of-Trade Changes, Real GDP, and Real Value Added in the
... real value added and real income. An improvement in the terms of trade essentially means that the country gets more for less. This phenomenon is similar to a technological progress. Contrary to a technological progress, however, a change in the terms of trade is treated by the national accounts as ...
... real value added and real income. An improvement in the terms of trade essentially means that the country gets more for less. This phenomenon is similar to a technological progress. Contrary to a technological progress, however, a change in the terms of trade is treated by the national accounts as ...
Macroeconomic Shocks and Monetary Policy
... 1 Introduction No country is immune to external economic shocks which cause fluctuations of domestic macroeconomic variables like output and inflation. Economic shocks to the supply-side or demand side of the economy may cause unpredictable changes in aggregate supply and aggregate demand and there ...
... 1 Introduction No country is immune to external economic shocks which cause fluctuations of domestic macroeconomic variables like output and inflation. Economic shocks to the supply-side or demand side of the economy may cause unpredictable changes in aggregate supply and aggregate demand and there ...
Interest Rates and Their Role in the Economy during Transition. The
... The role of interest rate in Ukraine has been studied by many Ukrainian and foreign economists. Gronicki and Pietka (1998) present the analysis of the role of interest rates in real economy of Ukraine until the beginning of 1998. The paper briefly describes the situation on the money market of Ukrai ...
... The role of interest rate in Ukraine has been studied by many Ukrainian and foreign economists. Gronicki and Pietka (1998) present the analysis of the role of interest rates in real economy of Ukraine until the beginning of 1998. The paper briefly describes the situation on the money market of Ukrai ...
The data are collected at a quarterly frequency, over a
... speech (King, 2006) that “rapid growth of money – as central banks have kept official interest rates very low – has helped to push up asset prices as investors search for yield. Data from the IMF suggest that world broad money in 2004 and 2005 was growing at its fastest rate since the late 1980s." S ...
... speech (King, 2006) that “rapid growth of money – as central banks have kept official interest rates very low – has helped to push up asset prices as investors search for yield. Data from the IMF suggest that world broad money in 2004 and 2005 was growing at its fastest rate since the late 1980s." S ...
Money and Inflation
... I caused the German government’s expenditures to greatly exceed revenues. The government could have obtained revenues to cover these increased expenditures by raising taxes, but that solution was, as always, politically unpopular and would have taken much time to implement. The government could also ...
... I caused the German government’s expenditures to greatly exceed revenues. The government could have obtained revenues to cover these increased expenditures by raising taxes, but that solution was, as always, politically unpopular and would have taken much time to implement. The government could also ...
Chapter 2: Review of Literature
... Inflation in an open economy can be influenced by both internal and external factors. Internal factors include, among others, the government budget deficit, monetary policy and structural regime changes (revolution, political regime changes, etc.). External factors include terms of trade and foreign ...
... Inflation in an open economy can be influenced by both internal and external factors. Internal factors include, among others, the government budget deficit, monetary policy and structural regime changes (revolution, political regime changes, etc.). External factors include terms of trade and foreign ...
lecture6_2006_hv
... The real interest rate becomes cyclic. At first it drops and then rises as P overshoots M! Investment follows a cyclic path, increases in the short-run due to a drop in the real interest rate, then drops as real interest rate rises. In the long-run it comes back to its steady state value As R drops ...
... The real interest rate becomes cyclic. At first it drops and then rises as P overshoots M! Investment follows a cyclic path, increases in the short-run due to a drop in the real interest rate, then drops as real interest rate rises. In the long-run it comes back to its steady state value As R drops ...