The Optimal Monetary Instrument for Prudential Purposes.
The purpose of this paper is to assess the choice between adopting a monetary base or an interest rate setting instrument to maintain financial stability. Our results suggest that the interest rate instrument is preferable, since during times of a panic or financial crisis the Central Bank automatic...
| Päätekijät: | , , |
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| Aineistotyyppi: | Working paper |
| Kieli: | English |
| Julkaistu: |
Oxford Finance
2008
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| _version_ | 1826272629011513344 |
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| author | Goodhart, C Sunirand, P Tsomocos, D |
| author_facet | Goodhart, C Sunirand, P Tsomocos, D |
| author_sort | Goodhart, C |
| collection | OXFORD |
| description | The purpose of this paper is to assess the choice between adopting a monetary base or an interest rate setting instrument to maintain financial stability. Our results suggest that the interest rate instrument is preferable, since during times of a panic or financial crisis the Central Bank automatically satisfies the increased demand for money. Thus, it prevents sharp losses in asset values and enhanced asset volatility. |
| first_indexed | 2024-03-06T22:15:36Z |
| format | Working paper |
| id | oxford-uuid:53492cf7-7457-411a-9cdc-c0dbdf1a9a55 |
| institution | University of Oxford |
| language | English |
| last_indexed | 2024-03-06T22:15:36Z |
| publishDate | 2008 |
| publisher | Oxford Finance |
| record_format | dspace |
| spelling | oxford-uuid:53492cf7-7457-411a-9cdc-c0dbdf1a9a552022-03-26T16:30:37ZThe Optimal Monetary Instrument for Prudential Purposes.Working paperhttp://purl.org/coar/resource_type/c_8042uuid:53492cf7-7457-411a-9cdc-c0dbdf1a9a55EnglishDepartment of Economics - ePrintsOxford Finance2008Goodhart, CSunirand, PTsomocos, DThe purpose of this paper is to assess the choice between adopting a monetary base or an interest rate setting instrument to maintain financial stability. Our results suggest that the interest rate instrument is preferable, since during times of a panic or financial crisis the Central Bank automatically satisfies the increased demand for money. Thus, it prevents sharp losses in asset values and enhanced asset volatility. |
| spellingShingle | Goodhart, C Sunirand, P Tsomocos, D The Optimal Monetary Instrument for Prudential Purposes. |
| title | The Optimal Monetary Instrument for Prudential Purposes. |
| title_full | The Optimal Monetary Instrument for Prudential Purposes. |
| title_fullStr | The Optimal Monetary Instrument for Prudential Purposes. |
| title_full_unstemmed | The Optimal Monetary Instrument for Prudential Purposes. |
| title_short | The Optimal Monetary Instrument for Prudential Purposes. |
| title_sort | optimal monetary instrument for prudential purposes |
| work_keys_str_mv | AT goodhartc theoptimalmonetaryinstrumentforprudentialpurposes AT sunirandp theoptimalmonetaryinstrumentforprudentialpurposes AT tsomocosd theoptimalmonetaryinstrumentforprudentialpurposes AT goodhartc optimalmonetaryinstrumentforprudentialpurposes AT sunirandp optimalmonetaryinstrumentforprudentialpurposes AT tsomocosd optimalmonetaryinstrumentforprudentialpurposes |