El próximo lunes 21 de septiembre tendremos un seminario impartido por José Víctor Ríos-Rullcon (University of Pennsylvania), titulado  "Real Monetary Policy". El seminario tendrá lugar a las 12:00 en la Sala de Juntas 1 del Edificio 2.  

Título: Real Monetary Policy

Autores: José Víctor Ríos-Rull, Joao Ritto, Tamon Takamura and Yaz Terajima.

Abstract: We build a quantitative general-equilibrium model of monetary policy transmission through bank lending under flexible prices, without nominal rigidities. A precautionary, Hopenhayn-style banking sector borrows short (deposits) and lends long (loans), holds reserves against withdrawal shocks and equity against loan losses, and faces reserve and capital requirements, a discount window, and costly entry and exit. Raising the interest rate on reserves increases banks' opportunity cost of lending: loan supply contracts, reserves and government bonds expand, and dividends rise. Because credit-financed expenditure feeds a productive externality, the loan contraction lowers measured aggregate productivity and output, a real credit multiplier that substitutes for the demand channel of New Keynesian models. We calibrate the model in general equilibrium to the U.S. commercial banking sector's 2006 aggregate balance sheet at quarterly frequency, and compute impulse responses to increases in the interest on reserves and in the discount-window rate. Real effects are sizable when expenditures are productive, and larger still when loans also finance firms' working capital, since credit contraction then directly distorts input choice. The framework offers a real, bank-balance-sheet channel of monetary transmission, complementary to sticky-price mechanisms, with collateral, New Keynesian/HANK, and financial-stability extensions left for future work.