We study asymmetric inflation effects of both conventional and unconventional monetary policy in the euro area during the period of low nominal interest rates. We find that rate cuts are inflationary also during low interest rates. Positive quantitative easing surprises have a deflationary...

This paper studies the effects of fiscal policy on aggregate economic activity and inequality when the monetary authority follows conventional and unconventional policies. First, I build a three-agent Preferred Habitat New Keynesian (PHANK) model with a banking sector in which QE matters for the...

The era of quantitative easing (QE) is going to be intensely studied for lessons to guide to the future conduct of central banking. There were major differences in the motivations and objectives of central banks for their QE programs, which led to very different approaches to their asset...

This paper develops a financial mechanism which integrates housing and the real economy through housing-secured debt. In this environment, movements in home prices are amplified through both borrowers and banks' balance sheets, leading to a self-reinforcing credit/liquidity crunch. When placed...