Skip navigation
User training | Reference and search service

Library catalog

Content aggregators
Please use this identifier to cite or link to this item:

Title: Modelling the central bank repo rate in a dynamic general equilibrium framework
Authors: Leão, E. R.
Keywords: Dynamic general equilibrium
Monetary policy
Central bank repo rate
Composition of investment expenditure
Price level determinancy
Issue Date: 2005
Publisher: Dinâmia
Series/Report no.: Dinâmia Working Paper
Abstract: The present paper adds a central bank to an existing general equilibrium model with banking sector. In our model, the central bank lends reserves to commercial banks and charges its repo interest rate. We obtain the usual result of flexible price models that expansionary monetary policy has a negligible effect on real variables such as output, consumption and investment expenditure. However, the composition of total investment is significantly altered as investment by banks increases at the expense of investment by nonbank firms. This result is a consequence of our explicit modelling of the central bank repo rate.
Description: JEL Classification: E13, E52.
Peer reviewed: Sim
Appears in Collections:DINÂMIA'CET-WP - Working papers com arbitragem científica

Files in This Item:
File Description SizeFormat 
DINAMIA_WP_2005-42.pdf1.88 MBAdobe PDFView/Open

FacebookTwitterDeliciousLinkedInDiggGoogle BookmarksMySpace
Formato BibTex MendeleyEndnote Currículo DeGóis 

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