EconReporter

In a recent research, four European Central Bank economists found that negative interest rate policy in the eurozone can encourage banks to increase lending and encourage cooperations to increase investments. That is, contrary to what macroeconomics models usually predict, interest rate policy can still has stimulative effect even the zero lower bound is reached.

The Federal Reserve is expected to cut its benchmark interest rate by 25 basis points this week. This has been the baseline market assumption since Chairman Jerome Powell's speech at Jackson Hole, in which he proclaimed, “the shifting balance of risks may warrant adjusting our policy stance." The question is, how many dissenting votes will Powell face in this meeting?

In a new working paper "The Non‐Bank Credit Cycle", researchers Esti Kemp, René van Stralen, Alexandros Vardoulakis, and Peter Wierts tried to look into the cyclical properties of non‐bank credit and its relevance for financial stability.

Hysteresis is referred to the hypothesis that recessions may have permanent effects on the level of output relative to trend.

Federal Reserve decided to cut rate by an supersized 0.5 percentage point. The decision finally ended the weeks-long market debate of whether the central bank would cut 25 or 50 basis points. One important thing, though, didn't reach the headline: The Fed has never been this "confused" about where the natural rate should be.

President Trump's plan to install a "Shadow Chair" months before Jerome Powell's term ends will definitely reshape US monetary policy — but it could face a surprising challenge from Powell himself.

Olivier Blanchard a list of things that macroeconomists normally agreed on and need no further discussions.

A series of papers by Stefan Avdjiev, Bilyana Bogdanova, Patrick Bolton, Wei Jiang, and Anastasia Kartasheva on this topic is highly recommended.

In his latest Brookings blog post "Modifying the Fed’s policy framework: Does a higher inflation target beat negative interest rates?", Ben Bernanke compares two...

George Akerlof explains how the Keynesian- neoclassical synthesis dominated the field, and what problems this dominance resulted.