Export shocks and the zero bound trap

When a small open economy experiences a sufficiently large negative export shock, it is vulnerable to falling into a zero bound trap. In addition, such a shock can have very large impact on the economy compared to the case when the zero bound is not a binding constraint. This could be one possible explanation as to why a country like Japan experienced much larger drop in output than the United States during the recent financial crisis.

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Year of publication:	2010
Authors:	Fujiwara, Ippei
Institutions:	Federal Reserve Bank of Dallas
Subject:	Monetary policy \| Banks and banking \| Central \| Global financial crisis \| Interest rates \| Japan

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Extent:	application/pdf
Series:	Globalization and Monetary Policy Institute Working Paper.
Type of publication:	Book / Working Paper
Notes:	Number 63
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10008690997