Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/186027 
Year of Publication: 
2013
Citation: 
[Journal:] Swiss Journal of Economics and Statistics [ISSN:] 2235-6282 [Volume:] 149 [Issue:] 3 [Publisher:] Springer [Place:] Heidelberg [Year:] 2013 [Pages:] 291-312
Publisher: 
Springer, Heidelberg
Abstract: 
Recently, convincing evidence has been presented that the recession in the wake of the recent financial crisis resulted primarily from an overly levered housing sector that was forced to deleverage and cut consumption spending when faced with collapsing housing prices. Following this interpretation it is argued that, as opposed to the consensus view on monetary policy in the vicinity of the ZLB, optimal monetary policy may involve an interest rate increase if the ZLB threatens to become a binding constraint in the aftermath of an asset price bust. This result delivers arguments to advocate a ­ in the previous literature less favored ­ pre-emptive tightening policy in an asset price boom.
Subjects: 
monetary policy
asset price bust
zero lower bound
cleaning-up
pre-emptive tightening
JEL: 
E52
E58
E44
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

Files in This Item:
File
Size
285.86 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.