Capital controls and monetary policy autonomy in a small open economy

• 成果类型: Article
• 署名作者: Davis, J. Scott; Presno, Ignacio
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - Dallas; Federal Reserve System - USA; Federal Reserve System Board of Governors
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2016.11.008
• 发表日期: 2017
• 页码: 114-130
• 关键词: Capital controls; credit constraints; Small open economy

摘要

Is there a link between capital controls and monetary policy autonomy in a country with a floating currency? Shocks to capital flows into a small open economy lead to volatility in asset prices and credit supply. To lessen the impact of capital flows on financial instability, a central bank finds it optimal to use the domestic interest rate to manage the capital account. Capital account restrictions affect the behavior of optimal monetary policy following shocks to the foreign interest rate. Capital controls allow optimal monetary policy to focus less on the foreign interest rate and more on domestic variables. (C) 2016 Elsevier B.V. All rights reserved.