A central concern in the field of international finance is always capital mobility. Feldstein and Horioka (1980) propose a simple test for international capital mobility and obtain a sign of very low capital mobility. Their interesting result is often described as the Feldstein-Horioka paradox....

This paper presents a method for deriving the real interest rate and the expected rate of inflation from the market information contained in indexed government bonds. It also discusses the implications and potential use for monetary policy of the information derived about the real interest rate...

In January 1997, the U.S. Treasury started issuing Treasury Inflation-Protection Securities (TIPS; hereafter TIPS and indexed bonds interchangeably) and, as of September 2002, a total of 10 issues were being traded on the market, while one issue had already matured. The purpose of this paper is...

We investigate the relationship between money, short-term interest rates, and scale variables. We use three monetary aggregates: Ml, demand deposits, and cash currency in circulation. Regional cross- sectional data yield stable estimates of the income elasticity of demand deposits that are...

This paper quantifies the policy duration effect of the zero interest rate policy implemented in Japan from February 1999 to August 2000. Our empirical analysis shows that the policy duration effect observed in Japanese financial markets emerged via the expectations channel on the future course...

This paper strives to answer five questions. First, why do legislators choose to create an independent central bank? Second, why do legislators delegate the conduct of monetary policy to a committee, rather than to a central bank governor? Third, what kinds of factors are crucial in limiting the...

This paper studies a small open economy with a large external debt. It begins by considering the long-term effects of shocks in the international capital market and domestic fiscal policy on the amount of outstanding external debt and the domestic reallocation of resources between the tradable...

We use data from the Public Opinion Surveys on Household Financial Assets and Liabilities from 1991 to 2002 to investigate the issues of unobserved heterogeneity among cross-sectional units and stability of the Japanese aggregate money demand function. Conditions that permit individual data and...

This paper uses household survey data that cover the period from 2001 through 2003 to study the cash and deposits demand of households. These data enable us to obtain empirical findings that could not previously be derived through analyses using conventional macroeconomic time-series data....

Using Japanese regional data, we have obtained estimates of the income elasticity of demand deposits that are positive, have values that are close to one, and are statistically significantly different from zero, not only during the period of the low interest rate policy implemented after 1995...