Tag Archives: Zero Lower Bound

Liquidity Trap and Excessive Leverage

From Anton Korinek and Alp Simsek: We investigate the role of macroprudential policies in mitigating liquidity traps driven by deleveraging, using a simple Keynesian model. When constrained agents engage in deleveraging, the interest rate needs to fall to induce unconstrained agents to … Continue reading

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Optimal Inflation Rates – the Costs & Benefits of Inflation

I’m giving a lecture today on inflation to prep Econ 191 students for Yuriy Gorodnichenko‘s paper (ungated) on Optimal Inflation Rates next week. I compiled a list of some costs and benefits of inflation from a few sources: an old Larry … Continue reading

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