Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/48688 
Year of Publication: 
2011
Series/Report no.: 
Beiträge zur Jahrestagung des Vereins für Socialpolitik 2011: Die Ordnung der Weltwirtschaft: Lektionen aus der Krise - Session: Dynamic Macroeconomics No. B4-V2
Publisher: 
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft
Abstract: 
Shocks in the financial sector caused the great recession of 2008 and pulled down the real economy. To implement financial dynamics in a stylized DSGE-framework we use behavioral elements in expectations to produce waves of bull and bear cycles in the financial intermediation process, that have repercussions on the business cycle dynamics. Our main findings suggest that rapid interest rate reduction and a countercyclical equity regulation in the finance sector can well prevent severe recessions.
Subjects: 
Animal spirits
bank regulation
financial intermediation
monetary policy
JEL: 
E32
E52
G21
Document Type: 
Conference Paper

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