Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/31535 
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dc.contributor.authorPalacio-Vera, Alfonsoen
dc.date.accessioned2010-05-14T11:08:36Z-
dc.date.available2010-05-14T11:08:36Z-
dc.date.issued2006-
dc.identifier.urihttp://hdl.handle.net/10419/31535-
dc.description.abstractWe present a simple theoretical framework that integrates the notion of the natural or neutral interest rate, liquidity preference theory, and the monetary policy practice by modern central banks. We claim that this theory explains the conditions under which an economy will experience an aggregate demand deficiency problem within a modern institutional setting. Contrary to the predictions of the New Consensus View in macroeconomics, the model suggests that structural” factors such as a high saving rate and, especially, a low natural” rate of growth increase the chances that an economy experiences an aggregate demand deficiency. Contrary to conventional wisdom, the model predicts that a fall in the NAIRU may lead to a rise in the natural interest rate, and vice versa.en
dc.language.isoengen
dc.publisher|aLevy Economics Institute of Bard College |cAnnandale-on-Hudson, NYen
dc.relation.ispartofseries|aWorking Paper |x478en
dc.subject.jelB50en
dc.subject.jelE12en
dc.subject.jelE24en
dc.subject.jelE50en
dc.subject.ddc330en
dc.subject.keywordNeutral interest rateen
dc.subject.keywordlower-bound trapen
dc.subject.keywordaggregate demand deficiencyen
dc.subject.keywordnatural rate of growthen
dc.titleOn lower-bound traps: a framework for the analysis of monetary policy in the age of central banks-
dc.typeWorking Paperen
dc.identifier.ppn570220483en
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen

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