Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/88227
Authors: 
Görgens, Egon
Ruckriegel, Karlheinz
Seitz, Franz
Year of Publication: 
2007
Series/Report no.: 
ROME Discussion Paper Series 07-01
Abstract (Translated): 
What role does (should) money play in modern central banking? To answer this question, it is necessary to distinguish between the different level playing fields of monetary policy. At the operational level, it is a short-term money market rate which the central bank tries to and can control. Therefore, monetary policy should be described in terms of an interest-rate feedback relation. Consequently, base money is an endogenous variable. This has been taken into account by the now-standard New-Keynesian macro models. As in these models money is a redundant variable, we extend the model to incorporate the money-price-nexus. Furthermore, we analyse what useful information monetary analysis can deliver for central banks both in theory and in practice. In sum, we find that ignoring the indicator properties of money in the transmission process would unduly restrain monetary policy.
Subjects: 
Geld
Geldpolitik
Indikator
Neu-Keynesianische Modelle
Reaktionsfunktion
JEL: 
E42
E52
E58
Document Type: 
Working Paper

Files in This Item:
File
Size
395.46 kB





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