Arbeitspapier
Optimal Central Bank Lending
We analyze optimal monetary policy in a sticky pricemodel where the central bank supplies money outrightvia asset purchases and lends money temporarily againstcollateral. The terms of central bank lending affect ra-tioning of money and impact on macroeconomic aggre-gates. The central bank can set the policy rate and itsinflation target in a way that implements the first bestlong-run allocation, which is impossible if money weresupplied in a lump-sum way (as commonly assumed).Efficient central bank lending further increases gainsfrom macroeconomic stabilization beyond pure interestrate policy. This requires departing from a Treasuries-only regime.
- Language
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Englisch
- Bibliographic citation
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Series: Tinbergen Institute Discussion Paper ; No. 10-057/2
- Classification
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Wirtschaft
Business Fluctuations; Cycles
- Subject
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Optimal monetary policy
central bank instruments
collateralized lending
liquidity premium
inflation
Geldpolitik
Kreditsicherung
Liquidität
Preisrigidität
Inflationssteuerung
Theorie
- Event
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Geistige Schöpfung
- (who)
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Schabert, Andreas
- Event
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Veröffentlichung
- (who)
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Tinbergen Institute
- (where)
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Amsterdam and Rotterdam
- (when)
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2010
- Handle
- Last update
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10.03.2025, 11:42 AM CET
Data provider
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Object type
- Arbeitspapier
Associated
- Schabert, Andreas
- Tinbergen Institute
Time of origin
- 2010