Monetary Policy at the Effective Lower Bound: Less Potent? More International? More Sticky?

摘要

This paper discusses whether monetary policy at the effective lower bound (ELB) is less effective, generates greater international spillovers, or is "stickier" than conventional monetary policy. It argues that monetary policy at the ELB can be potent and that there has thus far been no convincing evidence that it has greater international spillovers through capital flows and exchange rates than comparable adjustments in interest rates. It may be more challenging to raise rates off the ELB than to raise rates from higher levels-possibly due to counterbalancing effects through the exchange rate-although there are only anecdotes to support this stickiness rather than any formal, empirical evidence.