Is the negative interest rate policy effective?

An Analysis of the Negative Interest Rate Policy and its Effects on the Efficiency of Monetary Policy in the Framework of the Money in the Utility Function Model

Today, the unconventional policy of negative interest rate is discussed in many Western societies and developed countries, and the implementation of this policy in the financial and banking system has brought growth and prosperity in many economies involved in the crisis. In fact, by applying a negative interest rate, the bank will be able to direct credit allocation to productive and priority ...

Global Knowledge, Local Solutions: Interest Rate and Monetary Policy

Investigating the Relationship between the Facility Interest Rate and the Bank Deposit Interest Rate in Iran

The facility interest rate is one of the most important macroeconomic variables. The bank facility interest rate is associated with other macro-economic variables, one of which is the bank deposit interest rate. Using the time series data of the 1973-2017 period and the simultaneous equation system, the researchers estimated four equations using the three-stage least squares method.The result o...

On Interest Rate Policy and Asset Bubbles

In a provocative paper, Gali (2014), showed that a policymaker who raises interest rates because of concerns about a bubble will paradoxically make the bubble bigger. In this paper, we argue Gali’s framework abstracts from the possibility that a policymaker who raises rates might crowd out resources that would have otherwise been spent on the bubble. We show that when we modify Gali’s model to ...

Monetary Policy Committees and Interest Rate Smoothing

We extend the New Keynesian Monetary Policy literature relaxing the assumption that the decisions are taken by a single policymaker, considering instead that monetary policy decisions are taken collectively in a committee. We introduce a Monetary Policy Committee (MPC), whose members have different preferences between output and inflation variability and have to vote on the level of the interes...