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Tunnels and reserves in monetary policy implementation
| Content Provider | Library of Congress - Books/Printed Material |
|---|---|
| Author | Whitesell, William C. |
| Temporal Coverage | 2003 |
| Abstract | "In recent years, some central banks have implemented monetary policy without reserve requirements by using a ceiling and floor for overnight interest rates established by central bank lending and deposit facilities. This paper analyzes a theoretical model of such a "tunnel" system and the benefits of adding reserve requirements to it. However, reserve requirements may involve social costs owing to the reserve avoidance activities of banks. The paper also presents a modified model with no reserve avoidance, where banks optimally choose to hold voluntary reserve requirements. The paper highlights the importance for central banks to consider such models in light of idiosyncratic features of their own institutional environment, which may importantly condition the advisability of any particular approach"--Federal Reserve Board web site. |
| Language | English |
| Publisher | Federal Reserve Board, |
| Publisher Place | Washington, D.C. |
| Part of Series | Catalog |
| Requires | HTML5 supported browser |
| Access Restriction | Open |
| Subject Keyword | Bank Reserves Mathematical Models Monetary Policy Monetary Policy Implementation Overnight Interest Rates Reserve Requirements |
| Subject Domain (in LCSH) | Monetary policy--Mathematical models |
| Subject Domain (in LCSH) | Bank reserves--Mathematical models |
| Subject Domain (in LCSH) | Monetary policy implementation; |
| Subject Domain (in LCSH) | reserve requirements; |
| Subject Domain (in LCSH) | overnight interest rates |
| Subject Domain (in LCC) | HG1 |
| Content Type | Text |
| Resource Type | Book |
