Options
Capital-constrained loan creation, household stock market participation and monetary policy in a behavioural new Keynesian model
Kotb, Naira; Proaño, Christian R. (2024): Capital-constrained loan creation, household stock market participation and monetary policy in a behavioural new Keynesian model, in: Bamberg: Otto-Friedrich-Universität, S. 3789–3807.
Author:
By:
... ; Proaño, Christian R.
Publisher Information:
Year of publication:
2024
Pages:
Source/Other editions:
International journal of finance & economics : IJFE, 28 (2023), 4, S. 3789-3807. - ISSN: 1076-9307, 1099-1158
Year of first publication:
2023
Language:
English
Abstract:
In this paper, we incorporate a stock market and a banking sector in a behavioural macro-finance model with heterogenous and boundedly rational expectations. Households' savings are diversified among bank deposits and stock purchases, and banks' lending to firms is subject to capital-related deviation costs. We find that households' participation in the stock market, coupled to the existence of a capital-constrained banking sector affects the transmission of monetary policy to the economy significantly, and that households' deposits act as a critical spill-over channel between the real and the financial sectors. Further, we relate the deviation costs in the banking sector with the degree of pass-through of monetary policy shocks. Last, we investigate the performance of a leaning-against-the-wind monetary policy, which targets asset prices concerning macroeconomic and financial stability.
GND Keywords: ; ; ; ; ;
Kreditwesen
Geldpolitik
Aktienmarkt
Kreditgewährung
Verhaltensökonomie
Makroökonomie
Keywords: ; ; ;
banking
Behavioural macroeconomics
monetary policy
stock markets
DDC Classification:
RVK Classification:
Type:
Article
Activation date:
February 28, 2024
Project(s):
Permalink
https://fis.uni-bamberg.de/handle/uniba/93363