IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

Monetary Policy: Old Lessons and New Challenges

  • Eva Zamrazilová

The relatively long term period of stability before the present crises called even "Great Moderation" or "Golden Age of Central Banking" indicated that the infl ation targeting was a success story. As of 2008 a lot has changed and the debate over "Leaning against the wind or Clean afterwards?" is being revisited among central bankers and academicians. At the same time the question "Does money matter in monetary policy" is on the table again. This paper focuses on the discussion of these issues; moreover, some new challenges that emerged in previous three years are discussed. The crisis has highlighted an urgent need to incorporate banks and financial frictions into monetary policy modelling framework - therefore some new findings on this field of research are outlined. An important lesson from the crises is that price stability is not a sufficient precondition for financial stability, therefore an operational framework for financial stability is being searched - this is subject of the final part of this paper.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.vse.cz/polek/download.php?jnl=polek&pdf=769.pdf
Download Restriction: free of charge

File URL: http://www.vse.cz/polek/769
Download Restriction: free of charge

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by University of Economics, Prague in its journal Politická ekonomie.

Volume (Year): 2011 (2011)
Issue (Month): 1 ()
Pages: 3-21

as
in new window

Handle: RePEc:prg:jnlpol:v:2011:y:2011:i:1:id:769:p:3-21
Contact details of provider: Postal: nam. W. Churchilla 4, 130 67 Praha 3
Phone: (02) 24 09 51 11
Fax: (02) 24 22 06 57
Web page: http://www.vse.cz/

More information through EDIRC

Order Information: Postal: Redakce Politické ekonomie, Vysoká škola ekonomická, nám. W. Churchilla 4, 130 67 Praha 3
Web: http://www.vse.cz/polek/ Email:


References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. John Taylor, 2007. "Housing and Monetary Policy," Discussion Papers 07-003, Stanford Institute for Economic Policy Research.
  2. Frank Smets, 1997. "Financial asset prices and monetary policy: theory and evidence," BIS Working Papers 47, Bank for International Settlements.
  3. Jamie Morgan, 2009. "The limits of central bank policy: economic crisis and the challenge of effective solutions," Cambridge Journal of Economics, Oxford University Press, vol. 33(4), pages 581-608, July.
  4. Bernanke, B. & Gertler, M. & Gilchrist, S., 1998. "The Financial Accelerator in a Quantitative Business Cycle Framework," Working Papers 98-03, C.V. Starr Center for Applied Economics, New York University.
  5. William Poole, 1969. "Optimal choice of monetary policy instruments in a simple stochastic macro model," Special Studies Papers 2, Board of Governors of the Federal Reserve System (U.S.).
  6. Claudio Borio & Mathias Drehmann, 2009. "Towards an Operational Framework for Financial Stability: "Fuzzy" Measurement and its Consequences," Working Papers Central Bank of Chile 544, Central Bank of Chile.
  7. Scott Roger, 2009. "Inflation Targeting At 20; Achievements and Challenges," IMF Working Papers 09/236, International Monetary Fund.
  8. Dellas, H. & Diba, B. & Loisel, O., 2010. "Financial Shocks and Optimal Policy," Working papers 277, Banque de France.
  9. Charles Goodhart, 2010. "The changing role of central banks," BIS Working Papers 326, Bank for International Settlements.
  10. Charles Freedman & Douglas Laxton, 2009. "Why Inflation Targeting?," IMF Working Papers 09/86, International Monetary Fund.
  11. Goodhart, Charles & Hofmann, Boris, 2000. "Do Asset Prices Help to Predict Consumer Price Inflation?," Manchester School, University of Manchester, vol. 68(0), pages 122-40, Supplemen.
  12. Matteo Iacoviello & Stefano Neri, 2010. "Housing Market Spillovers: Evidence from an Estimated DSGE Model," American Economic Journal: Macroeconomics, American Economic Association, vol. 2(2), pages 125-64, April.
  13. Stefano NERI & Luca SESSA & Federico SIGNORETTI & Andrea GERALI, 2009. "Credit and Banking in a DSGE model," 2009 Meeting Papers 586, Society for Economic Dynamics.
  14. Adam Cagliarini & Christopher Kent & Glenn Stevens, 2010. "Fifty Years of Monetary Policy: What Have We Learned?," RBA Annual Conference Volume, in: Christopher Kent & Michael Robson (ed.), Reserve Bank of Australia 50th Anniversary Symposium Reserve Bank of Australia.
  15. Ben Bernanke & Mark Gertler, 2000. "Monetary Policy and Asset Price Volatility," NBER Working Papers 7559, National Bureau of Economic Research, Inc.
  16. Tovar, Camilo Ernesto, 2008. "DSGE Models and Central Banks," Economics Discussion Papers 2008-30, Kiel Institute for the World Economy.
  17. Stephen G. Cecchetti, 2005. "The Brave New World of Central Banking: The Policy Challenges Posed by Asset Price Booms and Busts," Working Papers 2005/14, Czech National Bank, Research Department.
  18. John B. Taylor, 2010. "Does the Crisis Experience Call for a New Paradigm in Monetary Policy?," CASE Network Studies and Analyses 402, CASE-Center for Social and Economic Research.
  19. Taylor, John B., 1993. "Discretion versus policy rules in practice," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 39(1), pages 195-214, December.
  20. Marvin Goodfriend, 2007. "How the World Achieved Consensus on Monetary Policy," Journal of Economic Perspectives, American Economic Association, vol. 21(4), pages 47-68, Fall.
  21. Claudio Borio & Mathias Drehmann, 2009. "Assessing the risk of banking crises - revisited," BIS Quarterly Review, Bank for International Settlements, March.
  22. Ben S. Bernanke & Mark Gertler, 2001. "Should Central Banks Respond to Movements in Asset Prices?," American Economic Review, American Economic Association, vol. 91(2), pages 253-257, May.
  23. Jiminez, G. & Ongena, S. & Saurina, J., 2007. "Hazardous Times for Monetary Policy : What do Twenty-three Million Bank Loans Say about the Effects of Monetary Policy on Credit Risk?," Discussion Paper 2007-75, Tilburg University, Center for Economic Research.
  24. Charles A. E. Goodhart & Carolina Osorio & Dimitrios P. Tsomocos, 2009. "Analysis of Monetary Policy and Financial Stability: A New Paradigm," CESifo Working Paper Series 2885, CESifo Group Munich.
  25. repec:fip:fedgsq:y:2010:x:4 is not listed on IDEAS
  26. Erlend Nier, 2009. "Financial Stability Frameworks and the Role of Central Banks; Lessons From the Crisis," IMF Working Papers 09/70, International Monetary Fund.
  27. Dijkman, Miquel, 2010. "A framework for assessing systemic risk," Policy Research Working Paper Series 5282, The World Bank.
  28. Charles Goodhart, 2010. "The Changing Role of Central Banks," FMG Special Papers sp197, Financial Markets Group.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:prg:jnlpol:v:2011:y:2011:i:1:id:769:p:3-21. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Vaclav Subrta)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.