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  • Open Daily: 10am - 10pm
    Alley-side Pickup: 10am - 7pm

    3038 Hennepin Ave Minneapolis, MN
    612-822-4611

Open Daily: 10am - 10pm | Alley-side Pickup: 10am - 7pm
3038 Hennepin Ave Minneapolis, MN
612-822-4611
Monetary policy, asset prices and the wealth channel: A counterfactual analysis of the United Kingdom economy

Monetary policy, asset prices and the wealth channel: A counterfactual analysis of the United Kingdom economy

Horlacher, Jonathan

Paperback

Business GeneralEconomics

ISBN10: 3656015139
ISBN13: 9783656015130
Publisher: Grin Verlag
Published: Sep 27 2011
Pages: 60
Weight: 0.20
Height: 0.14 Width: 5.83 Depth: 8.27
Language: English
Bachelor Thesis from the year 2010 in the subject Economics - Case Scenarios, grade: 5.75 von 6, University of St. Gallen, language: English, abstract: This thesis examines whether monetary policy in the United Kingdom during the last 15 years should have reacted more strongly to asset price misalignments in financial assets and real estate assets, and if it should have reacted with different magnitude to the two asset classes. A counterfactual analysis using a dynamic structural general equilibrium (DSGE) model is conducted to test several scenarios, as well as to derive the optimal parameter set by exposing the model to shocks derived from historical data. It concludes that a more proactive monetary policy would have been preferable in the past, and that monetary policy should have reacted more to misalignments in real estate prices than in financial asset prices. Reacting to asset prices in general is found to be optimal in the random case.

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