The zero-interest-rate bound and the role of the exchange rate for monetary policy in Japan

• 成果类型: Article; Proceedings Paper
• 署名作者: Coenen, G; Wieland, V
• 署名单位: European Central Bank; Goethe University Frankfurt
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/S0304-3932(03)00055-2
• 发表日期: 2003
• 页码: 1071-1101
• 关键词: Monetary policy rules; zero-interest-rate bound; liquidity trap; rational expectations; nominal rigidities; Exchange rates; Monetary transmission

摘要

In this paper we study the role of the exchange rate in conducting monetary policy in an economy with near-zero nominal interest rates as experienced in Japan since the mid-1990s. Our analysis is based on an estimated model of Japan, the United States and the euro area with rational expectations and nominal rigidities. First, we provide a quantitative analysis of the impact of the zero bound on the effectiveness of interest rate policy in Japan in terms of stabilizing output and inflation. Then we evaluate three concrete proposals that focus on depreciation of the currency as a way to ameliorate the effect of the zero bound and evade a potential liquidity trap. Finally, we investigate the international consequences of these proposals. (C) 2003 Elsevier B.V. All rights reserved.