In the wake of the Great Recession, a massive monetary policy stimulus was provided in the main OECD economies. It helped to stabilise financial markets and avoid deflation. Nonetheless, GDP growth has been sluggish and in some countries lower than expected given the measures taken, and...

How far to go – and to remain – in the direction of highly expansionary monetary policy hinges on the balance of marginal benefits and costs of additional monetary easing and its expected evolution over time. This paper sketches a framework for assessing this balance and applies it to four...

The prospective normalisation of monetary policies in the main OECD areas will be challenging given that current policy rates are likely to be significantly below neutral levels and that central bank balance sheets will be above the pre-crisis levels by a wide margin. Monetary policy...

This paper investigates whether OECD countries are facing secular stagnation. Secular stagnation is defined as a situation when policy interest rates bounded at zero fail to stimulate demand sufficiently, due to low or negative neutral real interest rates and low inflation, and when ensuing...

This paper describes developments in real long-term interest rates in the main OECD economies and surveys their various determinants. Real long-term government bond yields declined from the 1980s to very low levels in the recent period, though they have not reached the historical lows of the...

The empirical study of technology shocks is intensively conducted to evaluate plausibility of the technology-driven real business cycle hypothesis. A popular method is to identify technology shocks by the long-run restriction that those solely have permanent effects on labor productivity in the...

This paper examines the future evolution of the Asian currency arrangements from broader perspectives, including the optimal currency area theory and the experience with the European Currency Unit (ECU). Most academic literature on this topic concurs that the optimal currency area conditions...

This paper studies supply and demand factors that explain the recent decline in bank lending growth in the U.S. and Europe. During 2008, bank lending growth in the U.S. and Europe declined while lending rates remained relatively constant. This phenomenon was also observed in Japan during the...

We argue the prospects of an Asian currency unit and an Asian currency union with a comprehensive survey of the literature, an empirical analysis and a study of the European Currency Unit's (ECU) experience. Asian countries may meet optimal currency area conditions. However, many other factors...