ebooks and download videos Search All  Title  Author 
Home / Nonfiction / Business & Economics / Money & Monetary Policy

Breaking Through the Zero Lower Bound

| £3.75 | €4.22 | Ca$6.08 | Au$6.00
by Ruchir Agarwal & Miles Kimball
What is this?DRM-EPUB by download  |  $4.50
What is this?DRM-PDF by download  |  $4.50
add to wish list
Breaking Through the Zero Lower Bound by Ruchir Agarwal & Miles Kimball

There has been much discussion about eliminating the "zero lower bound" by eliminating paper currency. But such a radical and difficult approach as eliminating paper currency is not necessary. Much as during the Great Depression-when countries were able to revive their economies by going off the gold standard-all that is needed to empower monetary policy to cut interest rates as much as needed for economic stimulus now is to change from a paper standard to an electronic money standard, and to be willing to have paper currency go away from par. This paper develops the idea further and shows how such a mechanism can be implemented in a minimalist way by using a time-varying paper currency deposit fee between private banks and the central bank. This allows the central bank to create a crawling-peg exchange rate between paper currency and electronic money; the paper currency interest rate can be either lowered below zero or raised above zero. Such an ability to vary the paper currency interest rate along with other key interest rates, makes it possible to stimulate investment and net exports as much as needed to revive the economy, even when inflation, interest rates, and economic activity are quite low, as they are currently in many countries. The paper also examines different options available to the central bank to return to par when negative interest rates are no longer needed, and the associated implications for the financial sector and debt contracts. Finally, the paper discusses various legal, political, and economic challenges of putting in place such a framework and how policymakers could address them.

To view this DRM protected ebook on your desktop or laptop you will need to have Adobe Digital Editions installed. It is a free software. We also strongly recommend that you sign up for an AdobeID at the Adobe website. For more details please see FAQ 1&2. To view this ebook on an iPhone, iPad or Android mobile device you will need the Adobe Digital Editions app, or BlueFire Reader or Txtr app. These are free, too. For more details see this article.

SHARE  Share by Email  Share on Facebook  Share on Twitter  Share on Linked In  Share on Delicious
or call in the US toll free 1-888-866-9150 product ID: 803218

Ebook Details
Pages: 40
Size: 951 KB
Date published:   2015
ISBN: 9781513536910 (DRM-EPUB)
9781513543772 (DRM-PDF)

DRM Settings
Copying:not allowed
Printing:not allowed
Read Aloud:  not allowed

This product is listed in the following category:

Nonfiction > Business & Economics > Money & Monetary Policy

If you find anything wrong with this product listing, perhaps the description is wrong, the author is incorrect, or it is listed in the wrong category, then please contact us. We will promptly address your feedback.

© 2016