{"id":1514,"date":"2023-02-13T16:19:18","date_gmt":"2023-02-13T16:19:18","guid":{"rendered":"https:\/\/www.fiw.ac.at\/publications\/evaluation-of-unconventional-monetary-policy-in-a-small-open-economy\/"},"modified":"2023-02-13T16:19:18","modified_gmt":"2023-02-13T16:19:18","slug":"evaluation-of-unconventional-monetary-policy-in-a-small-open-economy","status":"publish","type":"publication","link":"https:\/\/www.fiw.ac.at\/en\/publications\/evaluation-of-unconventional-monetary-policy-in-a-small-open-economy\/","title":{"rendered":"Evaluation of unconventional monetary policy in a small open economy"},"content":{"rendered":"\nThis paper shows what are the consequences of omitting international dimension issues like international trade and financial channels when modeling the effects of unconventional monetary policy tools. To evaluate the size of discrepancies between consequences of a large-scale asset purchase program in a small open economy and a closed one, we extend one of the existing models analyzing a large-scale asset purchases by adding small open economy features. Finally we compare it with the original version.\n\nWe find that previous studies might overestimate the extent to what large-scale asset purchases affect real activity. Allowing agents to trade internationally with goods as well as saving via foreign, currency denominated deposits leads to a leakages that result in substantial differences between large-scale asset purchases in a small open economy and an autarky. Moreover, our results show that negative supply side shocks have less severe consequences in a small open economy comparing to an autarky, because they are offset by the real exchange rate depreciation which boosts competitiveness.\n\n","protected":false},"featured_media":0,"menu_order":0,"template":"","jelcode":[85,87],"keyword":[718,521,717],"class_list":["post-1514","publication","type-publication","status-publish","hentry","jelcode-e52","jelcode-f41","keyword-financial-frictions","keyword-small-open-economy","keyword-unconventional-monetary-policy"],"acf":{"year":2016,"month":3,"day":"","volume":"","number":"167","pages":31,"reviewed":"0","citeid":"FIW_WP_167","fiwseries":"FIW Working Papers","event":null},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v23.4 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Evaluation of unconventional monetary policy in a small open economy - FIW<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.fiw.ac.at\/en\/publications\/evaluation-of-unconventional-monetary-policy-in-a-small-open-economy\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Evaluation of unconventional monetary policy in a small open economy - FIW\" \/>\n<meta property=\"og:description\" content=\"This paper shows what are the consequences of omitting international dimension issues like international trade and financial channels when modeling the effects of unconventional monetary policy tools. 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