The Case for Repairing Broken Channels without the Use of Unconventional Monetary Policy

Mardini Patrick ()
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Mardini Patrick: Faculty of Business and Management, University of Balamand, PO Box 100, Tripoli, North Lebanon, Lebanon

Journal des Economistes et des Etudes Humaines, 2016, vol. 22, issue 1, 61-76

Abstract: The paper shows that the literature on broken channels (1) fails to provide an explanation of the root causes of the crisis, (2) mistakes a subjective human behavior for a mechanical failure and (3) confuses market adjustment mechanisms. From this perspective, the policy aiming to deploy unconventional monetary policies to overcome the broken channels is misguided. The paper fits broken channels into the framework of a more comprehensive theory of the business cycle and suggests a different policy recommendation.

Keywords: transmission channels; business cycle; Austrian economics (search for similar items in EconPapers)
Date: 2016
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DOI: 10.1515/jeeh-2016-0006

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