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dc.contributor.authorMerola, Rossanaen_US
dc.date.accessioned2010-02-15en_US
dc.date.accessioned2010-02-24T15:51:41Z-
dc.date.available2010-02-24T15:51:41Z-
dc.date.issued2010en_US
dc.identifier.isbn978-3-86558-594-3en_US
dc.identifier.urihttp://hdl.handle.net/10419/30031-
dc.description.abstractI analyze how the introduction of financial frictions can affect the trade-off between output stabilization and inflation stability and whether, in the presence of financial frictions, the optimal outcome can be realized or approached more closely if monetary policy is allowed to react to aggregate financial variables. Moreover, I explore the issue of whether an inflation targeting cum exchange rate stabilization and a price-level targeting are more suitable rules in minimizing distortions generated by the presence of liabilities defined in foreign currency and in nominal terms. I find that, when the financial accelerator mechanism is working, a price-level targeting rule dominates. One caveat is that the source of the shock plays an important role. Once the financial shock is not operative, the gain from a price-level targeting rule decreases significantly.en_US
dc.language.isoengen_US
dc.publisherDt. Bundesbank Frankfurt, M.en_US
dc.relation.ispartofseriesDiscussion Paper Series 1: Economic Studies 2010,01en_US
dc.subject.jelE31en_US
dc.subject.jelE44en_US
dc.subject.jelE52en_US
dc.subject.jelE58en_US
dc.subject.ddc330en_US
dc.subject.keywordMonetary policyen_US
dc.subject.keywordTaylor ruleen_US
dc.subject.keywordfinancial acceleratoren_US
dc.subject.keywordprice-level targetingen_US
dc.subject.keywordasset pricesen_US
dc.subject.stwGeldpolitiken_US
dc.subject.stwReaktionsfunktionen_US
dc.subject.stwTaylor-Regelen_US
dc.subject.stwFinanzmarkten_US
dc.subject.stwUnvollkommener Markten_US
dc.subject.stwKleines-offenes-Landen_US
dc.subject.stwWechselkurspolitiken_US
dc.subject.stwTheorieen_US
dc.titleOptimal monetary policy in a small open economy with financial frictionsen_US
dc.typeWorking Paperen_US
dc.identifier.ppn61856859Xen_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
dc.identifier.repecRePEc:zbw:bubdp1:201001-
Appears in Collections:Discussion Paper Series 1: Economic Studies, Deutsche Bundesbank

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