Arbeitspapier
Modeling two Macro policy instruments: Interest rates and aggregate capital requirements
We present a simple neoclassical model to explore how an aggregate bank-capital requirement can be used as a macroeconomic policy tool and how this additional tool interacts with monetary policy. Aggregate bank-capital requirements should be adjusted when the economy is hit by cost-push shocks but should not respond to demand shocks. Moreover, an optimal institutional structure is characterized as follows: First, monetary policy is delegated to an independent and conservative central banker. Second, setting aggregate bank-capital requirements is separated from monetary policy.
- Language
-
Englisch
- Bibliographic citation
-
Series: CESifo Working Paper ; No. 3598
- Classification
-
Wirtschaft
Monetary Policy
Central Banks and Their Policies
Financial Institutions and Services: Government Policy and Regulation
- Subject
-
central banks
banking regulation
capital requirements
optimal monetary policy
- Event
-
Geistige Schöpfung
- (who)
-
Gersbach, Hans
Hahn, Volker
- Event
-
Veröffentlichung
- (who)
-
Center for Economic Studies and ifo Institute (CESifo)
- (where)
-
Munich
- (when)
-
2011
- Handle
- Last update
-
10.03.2025, 11:46 AM CET
Data provider
This object is provided by:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Gersbach, Hans
- Hahn, Volker
- Center for Economic Studies and ifo Institute (CESifo)
Time of origin
- 2011
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