<div class="csl-bib-body">
<div class="csl-entry">Wolf, M., & Zessner-Spitzenberg, L. (2025, May). <i>Addictive Monetary Policy</i> [Conference Presentation]. Theories and Methods in Macro (T2M), Paris, France. http://hdl.handle.net/20.500.12708/217313</div>
</div>
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dc.identifier.uri
http://hdl.handle.net/20.500.12708/217313
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dc.description.abstract
We provide a model connecting monetary policy, credit creation, and nancial stability. Once debt levels in the economy are high, the central bank has incentives to cut the interest rate to preserve nancial stability. By undermining repayment incentives, however, the interest rate cut drags the debt overhang into the future. We show this feedback e ect may expose the economy to self-ful lling dynamics: Interest rate expectations may fall, pushing the economy in an equilibrium with low interest rates and even more debt. Anchoring interest rate expectations, and to a lesser extent, leaning against the wind, are key to avoid that a high debt economy becomes addicted to low interest rates.
en
dc.language.iso
en
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dc.subject
monetary policy
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dc.subject
credit creation
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dc.subject
financial stability
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dc.subject
financial dominance
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dc.subject
macro finance
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dc.subject
low interest rates
en
dc.subject
multiple steady states
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dc.subject
equilibrium multiplicity
en
dc.title
Addictive Monetary Policy
en
dc.type
Presentation
en
dc.type
Vortrag
de
dc.contributor.affiliation
University of St. Gallen, Switzerland
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dc.type.category
Conference Presentation
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tuw.researchTopic.id
A4
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tuw.researchTopic.id
C6
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tuw.researchTopic.name
Mathematical Methods in Economics
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tuw.researchTopic.name
Modeling and Simulation
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tuw.researchTopic.value
20
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tuw.researchTopic.value
80
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tuw.publication.orgunit
E105-03 - Forschungsbereich Ökonomie
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tuw.author.orcid
0000-0003-0035-8726
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tuw.author.orcid
0000-0002-8571-7515
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tuw.event.name
Theories and Methods in Macro (T2M)
en
tuw.event.startdate
22-05-2025
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tuw.event.enddate
23-05-2025
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tuw.event.online
On Site
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tuw.event.type
Event for scientific audience
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tuw.event.place
Paris
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tuw.event.country
FR
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tuw.event.institution
T2M
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tuw.event.presenter
Zessner-Spitzenberg, Leopold
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wb.sciencebranch
Wirtschaftswissenschaften
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wb.sciencebranch.oefos
5020
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wb.sciencebranch.value
100
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item.grantfulltext
none
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item.languageiso639-1
en
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item.cerifentitytype
Publications
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item.openairecristype
http://purl.org/coar/resource_type/c_18cp
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item.fulltext
no Fulltext
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item.openairetype
conference paper not in proceedings
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crisitem.author.dept
University of St. Gallen, Switzerland
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crisitem.author.dept
E105-03 - Forschungsbereich Ökonomie
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crisitem.author.orcid
0000-0002-8571-7515
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crisitem.author.parentorg
E105 - Institut für Stochastik und Wirtschaftsmathematik
