The debate over CEO compensation persists despite extensive efforts by academics and technocrats to understand its determinants. Most research has focused on how firm-specific characteristics and CEO-specific traits influence CEO compensation. However, the results have been contradictory,...

This paper examines whether monetary policy shocks affect CO₂ emissions over time in Brazil. We show that CO₂ emissions decline persistently following contractionary monetary policy shocks. The relationship between monetary policy and CO₂ emissions in Brazil is assessed through two...

Inequality of wealth or liquid finance in a system with credit market imperfection adversely affects investment by poor investors. This is well known in the literature. In this paper we prove that the aggregate credit demand function would be relatively inelastic with unequal wealth distribution...

Interest rate spreads vary widely across time and countries and are a central driver of business cycles in emerging market economies (EMEs). Since 2008, advanced market economies (AMEs) have exhibited persistently higher and more volatile spreads, alongside increased macroeconomic volatility and...

We study how firms' investment responds to interest rate changes based on a German firm survey, combining hypothetical vignettes, open-ended questions, and rich firm data. We estimate a 7 percent semi-elasticity of investment to loan rates-about half the total corporate investment response to...

We propose a macro-finance model in which inflation, growth, and the policy rate are driven by unobservable long-run trends and transitory cycles that investors must infer from aggregate data. Their subjective estimates of these trends, and the uncertainty surrounding them, are priced into the...

Evidence since the XIX century shows that whereas the demand for M1 is uniformly stable (Benati, Lucas, Nicolini, and Weber, 2021), the demand for broader aggregates is stable under monetary regimes making inflation strongly mean-reverting-such as the Gold Standard and inflation-targeting-but it...

The predictability of monetary policy surprises based on past, public information has been interpreted in two related yet fundamentally different ways. The "Fed information effect" posits that it arises due to markets updating their view of the economy, based on signals implicitly revealed by...

The yen depreciation from 2012-2015 reduced robot prices for U.S. firms. Paradoxically, financially constrained firms dramatically increased adoption relative to their unconstrained peers. We rationalize this with a collateral model: robots are pledgeable assets requiring non-pledgeable...

We develop a Trend-Cycle Bayesian VAR that jointly estimates the real neutral rate of interest, r∗t , and identifies monetary policy shocks. A key innovation is that cyclical shocks, notably monetary policy shocks, can affect the trend of macroeconomic variables, providing a way to assess...

The international co-movement of interest rates reflects correlated business-cycle fluctuations, largely driven by demand shocks. Monetary policy in advanced economies follows domestic mandates - inflation and the output gap - and does not respond to foreign policy shocks. We derive this result...

How borrowers respond to future changes in the interest rate on their debt matters for the transmission of monetary policy and for household financial stability. Combining bank data, a letter RCT, and a survey, we study this question in the context of the German mortgage market, where since 2022...

This paper estimates Morocco's natural interest rate (NIR) using two approaches: a standard HLW-type framework and an augmented specification that incorporates external factors, namely imported inflation, and movements in the real effective exchange rate. The results point to a downward trend in...

We study firms' financial and real decisions after an exogenous change in their interest rate beliefs induced by a survey experiment with an information treatment. Firms revise their expectations downward after learning about the European Central Bank's policy rate. Moreover, we find a reduction...

How borrowers respond to future changes in the interest rate on their debt matters for the transmission of monetary policy and for household financial stability. Combining bank data, a letter RCT, and a survey, we study this question in the context of the German mortgage market, where since 2022...

We use Canadian data to examine how monetary policy affects house prices and the consumer price index for rent (CPI-rent) through exogenous changes in the mortgage interest rates. Nationwide, tighter monetary policy lowers house prices but raises CPI-rent, likely due to higher user costs for...

The article estimates the effectiveness of tightening borrower-, capital-, and liquidity-based tools in decreasing the cyclical component of housing price growth and the probability of housing price booms with and without a low interest rate environment. The estimate is based on quarterly data...

Indonesia's financial system is bank-centric, with banks managing approximately 78% of the nation's financial assets; therefore, the effectiveness of monetary policy transmission depends on banks' responsiveness to the central bank's interest rate policy (the BI Rate). However, a policy-relevant...

We develop a practical framework for identifying and quantifying the hidden layers of risks and optionality embedded in American options by introducing stochasticity into one or more of their underlying determinants. The heuristic approach remedies the problems of conventional pricing systems,...

This paper maps the euro-area digital-banking segment and assesses how digital banks transmit monetary policy relative to brick-and-mortar peers. I compile a hand-checked universe of over 170 digital banks (2016-2025) from supervisory data, classifying institutions by business model (e-retail,...

This study examines the drivers of net interest margin (NIM) in developing economies, with a particular emphasis on Ethiopian commercial banks. It adopts an explanatory research design, analyzing quantitative data from the audited financial statements of 13 banks over 13 years (2012-2024),...

We develop a trend-cycle Bayesian vector autoregression that jointly estimates the real neutral rate of interest, 𝑟𝑡 ∗, and identifies monetary policy shocks. As a key innovation, the framework allows cyclical shocks, most notably monetary policy shocks, to affect the trend component of...

Revolving credit is at the core of the banking business. Corporate revolving credit lines are demandable claims; therefore, as with a traditional bank run on deposits, sudden widespread drawdowns on credit lines can destabilize the banking sector. However, we show that, unlike with deposits,...

This study empirically investigates the impact of Inflation Targeting (IT) on nominal interest rates over the past 40 years, focusing on 10 advanced and emerging economies. By using a Binary Regime Model embedded within a Backward-Looking Taylor, our findings confirm that IT adoption has...