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Global Effective Lower Bound and Unconventional Monetary Policy / Jing Cynthia Wu, Ji Zhang.

NBER Working papers Available online

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Format:
Book
Author/Creator:
Wu, Jing Cynthia.
Contributor:
National Bureau of Economic Research.
Zhang, Ji.
Series:
Working Paper Series (National Bureau of Economic Research) no. w24714.
NBER working paper series no. w24714
Language:
English
Physical Description:
1 online resource: illustrations (black and white);
Place of Publication:
Cambridge, Mass. National Bureau of Economic Research 2018.
Summary:
In a standard open-economy New Keynesian model, the effective lower bound causes anomalies: output and terms of trade respond to a supply shock in the opposite direction compared to normal times. We introduce a tractable framework to accommodate for unconventional monetary policy. In our model, these anomalies disappear. We allow unconventional policy to be partially active and asymmetric between countries. Empirically, we find the US, Euro area, and UK have implemented a considerable amount of unconventional monetary policy: the US follows the historical Taylor rule, whereas the others have done less compared to normal times.
Notes:
Print version record
June 2018.

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