Series: IMF Working Papers
Author(s): Francesco Furlanetto , Paolo Gelain , and Marzie Taheri Sanjani
Publisher: INTERNATIONAL MONETARY FUND
Publication Date: 18 July 2014
Keywords: Business cycles, Economic growth, Econometric models, Potential output, Macroprudential Policy, Monetary policy, Financial Frictions, Optimal Monetary Policy, Output Gap, inflation
The recent global financial crisis illustrates that financial frictions are a significant source of volatility in the economy. This paper investigates monetary policy stabilization in an environment where financial...