EconPapers    
Economics at your fingertips  
 

Monetary policy and cross-border interbank market fragmentation: lessons from the crisis

Tobias Blattner and Jonathan Swarbrick ()

EconStor Preprints from ZBW - Leibniz Information Centre for Economics

Abstract: We present a two-country model with an enhanced banking sector featuring risky lending and cross-border interbank market frictions. We find that (i) the strength of the financial accelerator, when applied to banks operating under uncertainty in an interbank market, will critically depend on the economic and financial structure of the economy; (ii) adverse shocks to the real economy can be the source of banking crisis, causing an increase in interbank funding costs, aggravating the initial shock; and (iii) asset purchases and central bank long-term refinancing operations can be effective substitutes for, or supplements to, conventional monetary policy.

Keywords: Interbank market; monetary union; financial frictions; cross-border capital flows; unconventional monetary policy (search for similar items in EconPapers)
JEL-codes: E44 E52 F32 F36 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba, nep-dge, nep-mac and nep-mon
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
https://www.econstor.eu/bitstream/10419/165991/1/paper.pdf (application/pdf)

Related works:
Working Paper: Monetary policy and cross-border interbank market fragmentation: lessons from the crisis (2018) 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: https://EconPapers.repec.org/RePEc:zbw:esprep:157881

Access Statistics for this paper

More papers in EconStor Preprints from ZBW - Leibniz Information Centre for Economics Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().

 
Page updated 2019-09-28
Handle: RePEc:zbw:esprep:157881