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Monetary policy challenges in emerging markets: Sudden stop, liability dollarization, and lender of last resort

Calvo, Guillermo A. - 2006

The paper argues that Emerging Market economies (EMs) face financial vulnerabilities that weaken the effectiveness of a domestic Lender of Last Resort (LOLR). As a result, monetary policy is inextricably linked to the state of the credit market. In particular, the central bank should be ready to...

Persistent link: https://www.econbiz.de/10010278274

Asset class diversification and delegation of responsibilities between central banks and sovereign wealth funds

Aizenman, Joshua; Glick, Reuven - 2010

This paper presents a model comparing the optimal degree of asset class diversification abroad by a central bank and a sovereign wealth fund. We show that if the central bank manages its foreign asset holdings in order to meet balance of payments needs, particularly in reducing the probability...

Persistent link: https://www.econbiz.de/10010333067

Asset class diversification and delegation of responsibilities between central banks and sovereign wealth funds

Aizenman, Joshua; Glick, Reuven - 2010

Persistent link: https://www.econbiz.de/10010287783

Targeting Inflation in a Dollarized Economy: The Peruvian Experience

Armas, Adrián; Grippa, Francisco - 2005

high degree of financial dollarization. The paper outlines how Peru has taken financial dollarization into consideration in …This discusses the unique experience of Peru`s Central Bank with inflation targeting in an economy characterized by a … controlling financial dollarization risks. The paper concludes with analysis and lessons drawn from the Peruvian case. …

Persistent link: https://www.econbiz.de/10010327093

Sterilization, monetary policy, and global financial integration

Aizenman, Joshua; Glick, Reuven - 2008

This paper investigates the changing pattern and efficacy of sterilization within emerging market countries as they liberalize markets and integrate with the world economy. We estimate the marginal propensity to sterilize foreign asset accumulation associated with net balance of payments...

Persistent link: https://www.econbiz.de/10010285325

Minsky, monetary policy, and mint street: Challenges for the art of monetary policymaking in emerging economies

Yanamandra, Srinivas - 2014

This paper examines the emerging challenges to the art of monetary policymaking using the case study of the Reserve Bank of India (RBI) in light of developments in the Indian economy during the last decade (2003-04 to 2013-14). The paper uses Hyman P. Minsky's financial instability hypothesis as...

Persistent link: https://www.econbiz.de/10010513058

Delegation, time inconsistency and sustainable equilibrium

Basso, Henrique S. - 2008

This paper analyzes the effectiveness of delegation in solving the time inconsistency problem of monetary policy using a microfounded general equilibrium model where delegation and reappointment are explicitly included into the government's strategy. The method of Chari and Kehoe (1990) is...

Persistent link: https://www.econbiz.de/10010321435

Managing global financial flows at the cost of national autonomy: China and India

Sen, Sunanda - 2012

Persistent link: https://www.econbiz.de/10010318671

Foreign exchange market interventions as monetary policy

Post, Erik - 2006

This paper sets up a simple model for interventions and interest rate setting assuming that the policy maker cares about deviations in inflation from a target level. Under a quadratic cost of interest rate adjustments and interventions the policy maker should use a combination of interest rate...

Persistent link: https://www.econbiz.de/10010321630

The Rise and Fall of U.S. Inflation Persistence

Beechey, Meredith; Österholm, Pär - 2007

This paper estimates the path of inflation persistence in the United States over the last 50 years and draws implications about the evolution of the Federal Reserve's monetary-policy preferences. Standard models of central bank optimization predict that the central bank's preference for output...

Persistent link: https://www.econbiz.de/10010321537