Liquidity effects in non Ricardian economies
It has often been found difficult to generate a liquidity effect (i.e. a negative effect of monetary injections on the nominal interest rate) in the traditional "Ricardian" stochastic dynamic model with a single infinitely lived household. We show that moving to a non Ricardian environment where new agents enter the economy in each period allows to generate such a liquidity effect.
|Date of creation:||Dec 2005|
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|Note:||View the original document on HAL open archive server: http://halshs.archives-ouvertes.fr/halshs-00590563|
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