Technological innovations and the interest rate
Autor(a) principal: | |
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Data de Publicação: | 2006 |
Outros Autores: | |
Tipo de documento: | Artigo |
Idioma: | eng |
Título da fonte: | Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
Texto Completo: | http://hdl.handle.net/10071/18138 |
Resumo: | We build a dynamic general equilibrium model that adds a banking sector to the standard RBC model. We look at the response of the real interest rate to innovations in the banks' technology and in the nonbank firms' technology. While technological innovations in the nonbanking sector put upward pressure on the interest rate, technological innovations in banks exert downward pressure on the interest rate. This implies that, if the technological innovations in banks are strong enough, stochastic simulation experiments generate negative correlations between the real interest rate and current and future values of real output. This is especially significant because negative correlations between the interest rate and output are a key post-war U.S. business cycle fact difficult to replicate in benchmark dynamic models. |
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Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
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Technological innovations and the interest rateRBC modelsSectoral technological innovationsCorrelation between real interest rate and real outputWe build a dynamic general equilibrium model that adds a banking sector to the standard RBC model. We look at the response of the real interest rate to innovations in the banks' technology and in the nonbank firms' technology. While technological innovations in the nonbanking sector put upward pressure on the interest rate, technological innovations in banks exert downward pressure on the interest rate. This implies that, if the technological innovations in banks are strong enough, stochastic simulation experiments generate negative correlations between the real interest rate and current and future values of real output. This is especially significant because negative correlations between the interest rate and output are a key post-war U.S. business cycle fact difficult to replicate in benchmark dynamic models.Springer Verlag2019-05-24T13:45:25Z2006-01-01T00:00:00Z20062019-05-24T14:45:07Zinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articleapplication/pdfhttp://hdl.handle.net/10071/18138eng0931-865810.1007/s00712-006-0205-7Leão, E. R.Leão, P. R.info:eu-repo/semantics/openAccessreponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãoinstacron:RCAAP2023-07-25T17:39:28ZPortal AgregadorONG |
dc.title.none.fl_str_mv |
Technological innovations and the interest rate |
title |
Technological innovations and the interest rate |
spellingShingle |
Technological innovations and the interest rate Leão, E. R. RBC models Sectoral technological innovations Correlation between real interest rate and real output |
title_short |
Technological innovations and the interest rate |
title_full |
Technological innovations and the interest rate |
title_fullStr |
Technological innovations and the interest rate |
title_full_unstemmed |
Technological innovations and the interest rate |
title_sort |
Technological innovations and the interest rate |
author |
Leão, E. R. |
author_facet |
Leão, E. R. Leão, P. R. |
author_role |
author |
author2 |
Leão, P. R. |
author2_role |
author |
dc.contributor.author.fl_str_mv |
Leão, E. R. Leão, P. R. |
dc.subject.por.fl_str_mv |
RBC models Sectoral technological innovations Correlation between real interest rate and real output |
topic |
RBC models Sectoral technological innovations Correlation between real interest rate and real output |
description |
We build a dynamic general equilibrium model that adds a banking sector to the standard RBC model. We look at the response of the real interest rate to innovations in the banks' technology and in the nonbank firms' technology. While technological innovations in the nonbanking sector put upward pressure on the interest rate, technological innovations in banks exert downward pressure on the interest rate. This implies that, if the technological innovations in banks are strong enough, stochastic simulation experiments generate negative correlations between the real interest rate and current and future values of real output. This is especially significant because negative correlations between the interest rate and output are a key post-war U.S. business cycle fact difficult to replicate in benchmark dynamic models. |
publishDate |
2006 |
dc.date.none.fl_str_mv |
2006-01-01T00:00:00Z 2006 2019-05-24T13:45:25Z 2019-05-24T14:45:07Z |
dc.type.status.fl_str_mv |
info:eu-repo/semantics/publishedVersion |
dc.type.driver.fl_str_mv |
info:eu-repo/semantics/article |
format |
article |
status_str |
publishedVersion |
dc.identifier.uri.fl_str_mv |
http://hdl.handle.net/10071/18138 |
url |
http://hdl.handle.net/10071/18138 |
dc.language.iso.fl_str_mv |
eng |
language |
eng |
dc.relation.none.fl_str_mv |
0931-8658 10.1007/s00712-006-0205-7 |
dc.rights.driver.fl_str_mv |
info:eu-repo/semantics/openAccess |
eu_rights_str_mv |
openAccess |
dc.format.none.fl_str_mv |
application/pdf |
dc.publisher.none.fl_str_mv |
Springer Verlag |
publisher.none.fl_str_mv |
Springer Verlag |
dc.source.none.fl_str_mv |
reponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação instacron:RCAAP |
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Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação |
instacron_str |
RCAAP |
institution |
RCAAP |
reponame_str |
Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
collection |
Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
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repository.mail.fl_str_mv |
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1777304011709349888 |