University of Oslo >
Department of Economics, University of Oslo >
Memorandum, Department of Economics, University of Oslo >
Please use this identifier to cite or link to this item:
| || |
|Title:||Overdeterminacy and endogenous cycles : Trygve Haavelmo's business cycle model and its implications for monetary policy |
|Authors:||Anundsen, André K.|
Krogh, Tord S. H.
|Issue Date:||2011 |
|Series/Report no.:||Memorandum // Department of Economics, University of Oslo 2011,03|
|Abstract:||This paper presents the business cycle model that Trygve Haavelmo developed as part of his research program in macroeconomic and monetary theory. Driven by a mismatch between the marginal return to capital and the rate of return required by capital owners, this model generates endogenous cycles. The theory leads to a distinct analysis of the scope and limitations of monetary policy. A main message of the model is that care should be taken when conducting 'autonomous' monetary policy and that special emphasis should be put on the soundness of nancial markets. Adopting a strict nominal anchor as the main objective of monetary policy might generate imbalances in the capital market.|
|Document Type:||Working Paper|
|Appears in Collections:||Memorandum, Department of Economics, University of Oslo|
Download bibliographical data as:
Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.