Global liquidity trap

Ippei Fujiwara, Tomoyuki Nakajima, Nao Sudo, Yuki Teranishi

研究成果: Article査読

13 被引用数 (Scopus)

抄録

How should monetary policy respond to a "global liquidity trap," where the two countries may fall into a liquidity trap simultaneously? Using a two-country New Open Economy Macroeconomics model, we first characterize optimal monetary policy, and show that the optimal rate of inflation in one country is affected by whether or not the other country is in a liquidity trap. We next examine how well the optimal monetary policy is approximated by relatively simple monetary policy rules. The interest-rate rule targeting the producer price index performs well in this respect.

本文言語English
ページ(範囲)936-949
ページ数14
ジャーナルJournal of Monetary Economics
60
8
DOI
出版ステータスPublished - 2013 11

ASJC Scopus subject areas

  • 財務
  • 経済学、計量経済学

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