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Monetary policy in a channel system

Aleksander Berentsen () and Cyril Monnet ()

No 08-7, Working Papers from Federal Reserve Bank of Philadelphia

Abstract: Channel systems for conducting monetary policy are becoming increasingly popular. Despite its popularity, the consequences of implementing policy with a channel system are not well understood. The authors develop a general equilibrium framework of a channel system and study the optimal policy. A novel aspect of the channel system is that a central bank can "tighten" or "loosen" its policy without changing its policy rate. This policy instrument has so far been overlooked by a large body of the literature on the optimal design of interest-rate rules.

Keywords: Monetary; policy (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba, nep-mac and nep-mon
Date: 2008
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Related works:
Journal Article: Monetary policy in a channel system (2008) Downloads
Working Paper: Monetary Policy in a Channel System (2007) Downloads
Working Paper: Monetary Policy in a Channel System (2006) Downloads
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