Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

Using panel quantile regressions for 11 advanced and 10 emerging market economies, we show that the conditional distribution of GDP growth depends on financial conditions, with growth-at-risk (GaR)—defined as growth at the lower 5th percentile—more responsive than the median or upper percentiles. In addition, the term structure of GaR features an intertemporal tradeoff: GaR is higher in the short run; but lower in the medium run when initial financial conditions are loose relative to typical levels, and the tradeoff is amplified by a credit boom. This shift in the growth distribution generally is not incorporated when solving dynamic stochastic general equilibrium models with macrofinancial linkages, which suggests downside risks to GDP growth are systematically underestimated.

Banks and banking --- Agricultural banks --- Banking --- Banking industry --- Commercial banks --- Depository institutions --- Finance --- Financial institutions --- Money --- Finance. --- Finance: General --- Macroeconomics --- Money and Monetary Policy --- International Business Cycles --- Monetary Growth Models --- Monetary Policy, Central Banking, and the Supply of Money and Credit: General --- General Financial Markets: Government Policy and Regulation --- Financial Markets and the Macroeconomy --- Monetary economics --- Growth-at-risk assessment --- Credit booms --- Credit --- Financial sector risk --- Macrofinancial linkages --- Financial sector policy and analysis --- Financial risk management --- Financial services industry --- United States

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

Has monetary policy in advanced economies been less effective since the global financial crisis because of deteriorating household balance sheets? This paper examines the question using household data from the United States. It compares the responsiveness of household consumption to monetary policy shocks in the pre- and post-crisis periods, relating changes in monetary transmission to changes in household indebtedness and liquidity. The results show that the responsiveness of household consumption has diminished since the crisis. However, household balance sheets are not the culprit. Households with higher debt levels and lower shares of liquid assets are the most responsive to monetary policy, and the share of these households in the population grew. Other factors, such as economic uncertainty, appear to have played a bigger role in the decline of households’ responsiveness to monetary policy.

Monetary policy --- Econometric models. --- Exports and Imports --- Finance: General --- Macroeconomics --- Financial Markets and the Macroeconomy --- Monetary Policy --- Consumer Economics: Empirical Analysis --- Macroeconomics: Consumption --- Saving --- Wealth --- Urban, Rural, and Regional Economics: Household Analysis: General --- International Lending and Debt Problems --- Portfolio Choice --- Investment Decisions --- Aggregate Factor Income Distribution --- International economics --- Finance --- Consumption --- Household consumption --- Debt burden --- Liquidity --- Income --- National accounts --- External debt --- Asset and liability management --- Economics --- Debts, External --- United States

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

Cross-border payments can be slow, expensive, and risky. They are intermediated by counterparties in different jurisdictions which rely on costly trusted relationships to offset the lack of a common settlement asset as well as common rules and governance. In this paper, we present a vision for a multilateral platform that could improve cross-border payments, as well as related foreign exchange transactions, risk sharing, and more generally, financial contracting. The approach is to leverage technological innovations for public policy objectives. A common ledger, smart contracts, and encryption offer significant gains to market efficiency, completeness, and access, as well as to transparency, transaction and compliance costs, and safety. This paper is a first step aiming to stimulate further work in this space.

United States --- Macroeconomics --- Economics: General --- Industries: Financial Services --- Money and Monetary Policy --- Finance: General --- Foreign Exchange --- Accounting --- Monetary Policy, Central Banking, and the Supply of Money and Credit: General --- Demand for Money --- International Financial Markets --- International Finance: General --- Monetary Systems --- Standards --- Regimes --- Government and the Monetary System --- Payment Systems --- Public Administration --- Public Sector Accounting and Audits --- Economic & financial crises & disasters --- Economics of specific sectors --- Computer applications in industry & technology --- Monetary economics --- Finance --- Currency --- Foreign exchange --- Financial reporting, financial statements --- Smart contracts --- Technology --- Currencies --- Money --- Currency markets --- Financial markets --- Financial statements --- Public financial management (PFM) --- Currency crises --- Informal sector --- Economics --- Financial services industry --- Technological innovations --- Foreign exchange market --- Finance, Public