Arbeitspapier
Lower for longer under endogenous technology growth
This paper studies monetary policy strategies under endogenous technology dynamics and low r ∗ . Endogenous growth strengthens the gains from make-up strategies relative to inflation targeting, especially if policy space is reduced. This result is due to the long-run non-neutrality of money and the hysteresis effects in TFP through which ELB episodes generate permanent scars on long-run aggregate supply. Make-up strategies not only foster the alignment of inflation with target but also support productivity-improving investment in R&D and technology adoption and hence the long-run trend path, provided that the inherent make-up element is sufficiently pronounced. Inflation is less responsive to monetary policy due to the interaction with productivity dynamics. As a result, additional stimulus is required at the ELB and the degree of subsequent overshooting is alleviated. Endogenous growth also generates novel monetary policy trade-offs, most notably credibility challenges, which can be mitigated by confining make-up elements to ELB episodes.
- Sprache
-
Englisch
- ISBN
-
978-952-323-403-1
- Erschienen in
-
Series: Bank of Finland Research Discussion Papers ; No. 6/2022
- Klassifikation
-
Wirtschaft
Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
Price Level; Inflation; Deflation
Business Fluctuations; Cycles
Monetary Policy
Innovation; Research and Development; Technological Change; Intellectual Property Rights: General
- Thema
-
Make-up Strategies
ZLB
Endogenous TFP
Hysteresis
Cycle-Trend Interaction
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Elfsbacka Schmöller, Michaela
Spitzer, Martin
- Ereignis
-
Veröffentlichung
- (wer)
-
Bank of Finland
- (wo)
-
Helsinki
- (wann)
-
2022
- Handle
- URN
-
urn:nbn:fi:bof-202203311126
- Letzte Aktualisierung
-
10.03.2025, 11:42 MEZ
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Elfsbacka Schmöller, Michaela
- Spitzer, Martin
- Bank of Finland
Entstanden
- 2022
Ähnliche Objekte (12)
Endogenous technology, scarring and fiscal policy
Lower for longer under endogenous technology growth
How effective quantitative tightening can be with a higher-for-longer pledge?
Stabilisation bias in monetary policy under endogenous price stickiness
The net stable funding ratio requirement when money is endogenous
A shadow rate model with time-varying lower bound of interest rates
Assessing targeted longer-term refinancing operations: Identification through search intensity
Endogenous market structures and labour market dynamics
Endogenous TFP, business cycle persistence and the productivity slowdown
Price stability and debt sustainability under endogenous trend growth
Monetary policy rules and the effective lower bound in the Euro area
Policy asymmetries, endogenous market structure with multinational corporations and the pattern of commodity trade
Endogenous technology, scarring and fiscal policy
Lower for longer under endogenous technology growth
How effective quantitative tightening can be with a higher-for-longer pledge?
Stabilisation bias in monetary policy under endogenous price stickiness
The net stable funding ratio requirement when money is endogenous
A shadow rate model with time-varying lower bound of interest rates
Assessing targeted longer-term refinancing operations: Identification through search intensity
Endogenous market structures and labour market dynamics
Endogenous TFP, business cycle persistence and the productivity slowdown
Price stability and debt sustainability under endogenous trend growth
Monetary policy rules and the effective lower bound in the Euro area
Policy asymmetries, endogenous market structure with multinational corporations and the pattern of commodity trade
Endogenous technology, scarring and fiscal policy
Lower for longer under endogenous technology growth
How effective quantitative tightening can be with a higher-for-longer pledge?
Stabilisation bias in monetary policy under endogenous price stickiness
The net stable funding ratio requirement when money is endogenous
A shadow rate model with time-varying lower bound of interest rates
Assessing targeted longer-term refinancing operations: Identification through search intensity
Endogenous market structures and labour market dynamics
Endogenous TFP, business cycle persistence and the productivity slowdown
Price stability and debt sustainability under endogenous trend growth
Monetary policy rules and the effective lower bound in the Euro area