 The Literature on Monetary Policy ImplementationChapter Chapter 2 in Monetary Policy Implementation, 2024, pp 15-34 from Springer Abstract: Abstract This chapter discusses the literature on monetary policy implementation. First, it focuses on the recent debate about the outcome of the ongoing normalization process, with particular attention to the euro area and the US. Despite the different views about the pros and cons of the two options on the table, either keep the floor system in place or go back to the corridor system, the first option seems to be prevailing among scholars and central bankers, for several reasons: the problems related to the unwinding of the huge excess liquidity accumulated during the years of quantitative easing policies, the difficulties in providing reliable estimates of the demand for bank reserves, and the financial stability concerns raised by a regime relying on liquidity shortage. We will then review the older literature on the traditional interest rate steering framework, which has introduced some cornerstone ideas, such as: decoupling principle, averaging provision of the reserve requirement as a stabilizing mechanism, and open mouth operations. Keywords: Normalization of monetary policy; Excess liquidity; Interest rate policy; Balance sheet policy; Minimum reserve requirement; Open mouth operations; Money market (search for similar items in EconPapers) There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-031-53885-8_2 Ordering information: This item can be ordered from DOI: 10.1007/978-3-031-53885-8_2 Access Statistics for this chapter More chapters in Springer Books from Springer |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.