EconPapers    
Economics at your fingertips  
 

The central-bank balance sheet as an instrument of monetarypolicy

Vasco Cúrdia () and Michael Woodford ()

Journal of Monetary Economics, 2011, vol. 58, issue 1, pages 54-79

Abstract: We extend a standard New Keynesian model to allow an analysis of "unconventional" dimensions of policy alongside traditional interest-rate policy. We find that quantitative easing in the strict sense is likely to be ineffective, but that targeted asset purchases by a central bank can instead be effective when financial markets are sufficiently disrupted, and we discuss the conditions under which such interventions increase welfare. We also discuss optimal policy with regard to the payment of interest on reserves.

Keywords: Credit; policy; Quantitative; easing; Zero; lower; bound; Interest; on; reserves (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (57) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/B6VBW ... 58ddf4ea1615dac4cf31
Full text for ScienceDirect subscribers only

Related works:
Working Paper: The Central Bank Balance Sheet as an Instrument of Monetary Policy (2010) Downloads
Working Paper: The central-bank balance sheet as an instrument of monetary policy (2010) Downloads
Working Paper: The Central-Bank Balance Sheet as an Instrument of Monetary Policy (2010) Downloads
Working Paper: The Central Bank's Balance Sheet as an Instrument of Monetary Policy (2010) Downloads
Working Paper: The Central-Bank Balance Sheet as an Instrument of Monetary Policy Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:eee:moneco:v:58:y:2011:i:1:p:54-79

Access Statistics for this article

Journal of Monetary Economics is currently edited by R. G. King and C. I. Plosser

More articles in Journal of Monetary Economics from Elsevier
Series data maintained by Zhang, Lei ().

 
Page updated 2014-09-14
Handle: RePEc:eee:moneco:v:58:y:2011:i:1:p:54-79