Monetary Economics (Possible Research Interests (https://pubs.aeaweb…
Possible Research Interests
THIS PAPER IS A MODEL ABOUT THE ROLE THAT TRUST IN THE MONETARY AUTHORITY PLAYS IN AN ECONOMY
THE NEW KEYNESIAN LIQUIDITY TRAP
UNCONVENTIONAL MONETARY POLICY AND BEYOND
So far I am enjoying this article. One of the more
interesting things mentioned in it is the wealth effect that the fed is able to impose on individuals through higher interest rates.
Indeed, it would be interesting to look into this effect and try and measure it econometrically. Is it linear?
The Income Effect as a special case of
the Wealth Effect
Wiki Definition of Income Effect:
Change in consumption resulting from a change in real income
Changes in consumption due to changes in wealth. In the positive sense, an increase in wealth may cause an increase in consumption. Of course, to facilitate this increase in consumption, the individual will demand more money. He or she will go to the bank to get more money by taking out a loan and spending it
Look at the two definitions above. Obviously when a persons wealth increases, it is not necessarily so that it is because of his or her income has done so. However, when a person's income increases, her wealth does increase.
RESEARCH IDEA II
Estimating the effect of equity prices on consumption via the wealth effect.
Does Monetary Policy affect equity prices?
If this relationship exists, what happens to consumption when the Fed raise interest rates?
There is already a lot of research showing that monetary policy does have an effect on stock prices.
Therefore, a better question to ask
What ratios and financial metrics should we be exploring to get to the root of the heterogeneity that Ehrmann and Fratzscher describe?
Credit Rating- The better the rating the easier time the company has with financing expenditures and thus the less monetary policy should have an effect on stock price
See the Conclusion section of Ehrmann and Fratzcher
The Role of Stigma In Financial Distress
Should a central bank aim to control stigma?
Money, Banking and Financial Markets
Written by Professor Stephen G. Cecchetti, and Professor Kermit L. Schoenholtz
The Money Illusion
Written by Scott Sumner, credited with popularizing the targetting of Nominal GDP
Long and Variable
Written by professor Tony Yates who works at University of Birmingham U.K.
Written by professor Carola Binder
Written by David Andolfatto, Vice President of the St. Louis Fed
New Monetarist Economic
A highly technical blog written by Stephen Williamson, former Vice President of the St. Louis Fed
Roger E. A. Farmer
Just a blog written by a leading scholar
Written by John Taylor who of course created the "Taylor Rule"