Journal of Money, Credit & Banking

Reports major findings in the study of financial institutions, financial markets, monetary and fiscal policy, credit markets, money and banking.

Articles from Vol. 40, No. 4, June

Commercially Available Order Flow Data and Exchange Rate Movements: Caveat Emptor
FOREIGN EXCHANGE MARKET order flow may be defined as transaction volume signed according to the initiator of the trade (Lyons 2001)--positive for a buy order, negative for a sell order. It is distinct from transaction volume, since the latter is a...
Credit Card Debt and Default over the Life Cycle
OVER THE LAST two decades, there has been a substantial increase in personal bankruptcy filings, from 0.35% to 1.4% per year. Such high levels in bankruptcy rates may put credit market stability at risk. As a result, politicians and economists have...
Did Hayek and Robbins Deepen the Great Depression?
I think the Austrian business-cycle theory, has done the worm a great deal of harm. If you go back to the 1930s, which is a key point, here you had the Austrians sitting in London, Hayek and Lionel Robbins, and saying you just have to let the bottom...
Estimating the New Keynesian Phillips Curve: A Vertical Production Chain Approach
THE NEW KEYNESIAN PHILLIPS CURVE (NKPC) has become the backbone of current macroeconomic inflation research. The model's prominence resides in its simple structure yet micro-founded principles whereby firms make their pricing decisions in a setting...
Financial Intermediaries, Markets, and Growth
AN IMPORTANT QUESTION related to both growth and finance theory is whether the financial system influences growth in the long run. We build a model in which financial markets reduce the amount of risk-sharing that financial intermediaries can provide...
Inflation Band Targeting and Optimal Inflation Contracts
WITH THE DEVELOPMENT of the literature on the time-inconsistency problem in Kydland and Prescott (1977), Calvo (1978), and Barro and Gordon (1983), there has been an increasing recognition both by policymakers and the academic literature that solving...
Multiple Equilibria in Markets with Screening
THE INFORMATION-GATHERING and information-processing functions of banks have crucial implications for the nature of banking competition. This point has been stressed by Broecker (1990), who analyzes a credit market where banks use imperfect and independent...
Optimal Monetary Policy in a Small Open Economy with Home Bias
A CENTRAL ISSUE in the recent open-economy New Keynesian literature is whether exchange rate stabilization should be part of a central bank's monetary policy strategy. This is also the key feature that induces fundamental differences in the design...
Pegged Exchange Rate Regimes-A Trap?
EXITS FROM PECKED exchange rate regimes have often been accompanied by crises and severe declines in economic activity. Major currency crises over the past decade have had particularly adverse effects on output growth; for example, output declined...
The Great Inflation Was Not Asymmetric: International Evidence
DURING THE GREAT INFLATION, inflation rose over a longer period than it fell in the United States. This asymmetry has been widely noted in the literature and is one target of models that seek to explain the Great Inflation. The explicit chronology...
The New Keynesian Phillips Curve: From Sticky Inflation to Sticky Prices
The theories usually stop short, however, of specifying models of aggregate supply that are intended to hold generally. --David Romer Advanced Macroeconomics, 2006, p. 257 RECENT EMPIRICAL STUDIES of the New Keynesian Phillips Curve (NKPC) have...