Payment obligations, reserve requirements and the demand for central bank balances

Article Abstract:

The individual bank's optimization problem was studied to derive an exact solution, subject to uncertainty and stochastic reserve requirements on the basis of model with data from the 40 largest participants in the Swiss Interbank Clearing System (SIC) for the period from 1992 to 1993. It is found that the value of payments is the most important factor in determining the turnover ratio.

United States, Financial management, Finance, Company financing

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On the optimal monetary policy response to noisy indicators

Article Abstract:

A behavior of a central bank during the measurement of current inflation and output, which is subject to measurement errors, in a framework of optimizing models with nominal price stickiness is discussed. The optimal policy describes the smoothening of the interest rate, which is generally seen in the literature on monetary policy reaction functions.

Analysis, Pricing policies

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Optimal monetary policy responses to relative-price changes

Article Abstract:

A study is conducted into the optimal monetary policy responses to relative-price changes, in which an optimising model is employed to study the effects of these changes on fluctuations in inflation. A discussion is also presented of an ideal monetary policy for a small open economy.

Models, Economic aspects, Pricing, Observations, Keynesian economics

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