Understanding Benign Liquidity Traps: The Case of Japan
Annual Conference 2016 (Augsburg): Demographic Change from Verein für Socialpolitik / German Economic Association
Japan has been in a benign liquidity trap since the 1990s. In a benign liquidity trap, interest rates approach zero and monetary policy is ineffective but output and employment perform decently. Such a pattern contradicts traditional macro theories. This paper introduces a monetary general equilibrium model that is compatible with Japan’s performance and resolves puzzles associated with liquidity traps. Possible conclusions for Anglo-Saxon countries and eurozone members are also discussed
JEL-codes: E31 E43 E52 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mac and nep-mon
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Journal Article: Understanding Benign Liquidity Traps: The Case of Japan (2017)
Working Paper: Understanding Benign Liquidity Traps: The Case of Japan (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc16:145467
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