Furlanetto, Francesco; Gelain, Paolo; Sanjani, Marzie Taheri - International Monetary Fund (IMF) - 2014
The recent global financial crisis illustrates that financial frictions are a significant source of volatility in the … economy. This paper investigates monetary policy stabilization in an environment where financial frictions are a relevant …. Furthermore we illustrate that, in the presence of financial frictions, a benevolent central bank faces a substantial trade …