Central Banking, Asset Prices and Financial Fragility

ISBN-13: 9780415773997 / Angielski / Twarda / 2008 / 336 str.

Éric Tymoigne

Opis

In this book Tymoigne argues that financial stability should be the sole goal of central banks. Inflation, growth, full employment, distribution, and other macroeconomic goals should be managed by other public institutions.

Taking financial stability seriously has several important implications for the method of intervention of central banks in the economy (tools and instruments), the regulation and supervision of the financial system, and the financial reform that central banks should undertake. For example, questions about how well asset prices are valuated become unimportant for the conduct of central banking.

Drawing upon the work of John Maynard Keynes, Paul Davidson, Hyman Minsky, Jan Kregel and others, the author suggests an alternative to the inflation targeting framework or any other interest-rate based central bank policies, and shows how the latter can help to solve some of the problems faced by central bankers.

Spis treści

1 Introduction, 2 Central banking, asset prices, and financial fragility, 3 Asset-price theories and central banking, 4 Against the instrumental use of interest rates, 5 An analysis of financial fragility in the Minskian tradition, 6 Financial matters in the decisions of the FOMC, 7 Conclusion: A New Role for the Central Bank, Appendix 1: Own-Rates of Interest, Real Rates of Interest, and Money Rates of Interest, Appendix 2: The Aggregate Liquidity Preference Ratio with K Assets, Appendix 3: Immunization Procedure with Consols, Appendix 4: Econometric Analysis of Inflation and Interest Rates, Appendix 5: Financial Disturbances and Financial Crises in the U.S

O autorze

Eric Tymoigne is Assistant Professor of Economics at California State University Fresno.