Determinacy, stock market dynamics and monetary policy inertia

Damjan Pfajfar; Emiliano Santoro

doi:10.1016/j.econlet.2011.02.033

Determinacy, stock market dynamics and monetary policy inertia

Damjan Pfajfar, Emiliano Santoro

Økonomisk Institut

6 Citationer (Scopus)

Abstract

We study equilibrium determinacy in a New-Keynesian model where the Central Bank responds to asset prices growth. Unlike Taylor-type rules that react to asset prices, the proposed alternative does not harm dynamic stability and in certain cases promotes determinacy by inducing interest-rate inertia.

Originalsprog	Engelsk
Tidsskrift	Economics Letters
Vol/bind	112
Udgave nummer	1
Sider (fra-til)	7-10
Antal sider	4
ISSN	0165-1765
DOI	https://doi.org/10.1016/j.econlet.2011.02.033
Status	Udgivet - jul. 2011

Emneord

Asset prices
Determinacy
Monetary policy inertia

Adgang til dokumentet

10.1016/j.econlet.2011.02.033

Citationsformater

@article{15c40225bc3f4c639b339d5562b0dfc5,

title = "Determinacy, stock market dynamics and monetary policy inertia",

abstract = " We study equilibrium determinacy in a New-Keynesian model where the Central Bank responds to asset prices growth. Unlike Taylor-type rules that react to asset prices, the proposed alternative does not harm dynamic stability and in certain cases promotes determinacy by inducing interest-rate inertia.",

keywords = "Asset prices, Determinacy, Monetary policy inertia",

author = "Damjan Pfajfar and Emiliano Santoro",

note = "JEL classification: C62, E52",

year = "2011",

month = jul,

doi = "10.1016/j.econlet.2011.02.033",

language = "English",

volume = "112",

pages = "7--10",

journal = "Economics Letters",

issn = "0165-1765",

publisher = "Elsevier",

number = "1",

}

TY - JOUR

T1 - Determinacy, stock market dynamics and monetary policy inertia

AU - Pfajfar, Damjan

AU - Santoro, Emiliano

N1 - JEL classification: C62, E52

PY - 2011/7

Y1 - 2011/7

N2 - We study equilibrium determinacy in a New-Keynesian model where the Central Bank responds to asset prices growth. Unlike Taylor-type rules that react to asset prices, the proposed alternative does not harm dynamic stability and in certain cases promotes determinacy by inducing interest-rate inertia.

AB - We study equilibrium determinacy in a New-Keynesian model where the Central Bank responds to asset prices growth. Unlike Taylor-type rules that react to asset prices, the proposed alternative does not harm dynamic stability and in certain cases promotes determinacy by inducing interest-rate inertia.

KW - Asset prices

KW - Determinacy

KW - Monetary policy inertia

U2 - 10.1016/j.econlet.2011.02.033

DO - 10.1016/j.econlet.2011.02.033

M3 - Journal article

SN - 0165-1765

VL - 112

SP - 7

EP - 10

JO - Economics Letters

JF - Economics Letters

IS - 1

ER -