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 automati...

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Автори: Goodhard, C, Sunirand, P, Tsomocos, D
Формат: Working paper
Опубліковано: University of Oxford 2008
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author Goodhard, C
Sunirand, P
Tsomocos, D
author_facet Goodhard, C
Sunirand, P
Tsomocos, D
author_sort Goodhard, 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
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spelling oxford-uuid:e284ea0e-bd64-451e-9f9e-0cce8499cc412022-03-27T10:01:49ZThe optimal monetary instrument for prudential purposesWorking paperhttp://purl.org/coar/resource_type/c_8042uuid:e284ea0e-bd64-451e-9f9e-0cce8499cc41Symplectic ElementsBulk import via SwordUniversity of Oxford2008Goodhard, 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 Goodhard, 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
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