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Banks in The Global Integrated Monetary and Fiscal Model

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Listed:
  • Michal Andrle
  • Mr. Michael Kumhof
  • Mr. Douglas Laxton
  • Mr. Dirk V Muir

Abstract

The Global Integrated Monetary and Fiscal model (GIMF) is a multi-region DSGE model developed by the Economic Modeling Division of the IMF for policy and scenario analysis. This paper compares two versions of GIMF, GIMF with a conventional financial accelerator, where bank balance sheets do not play a prominent role, and GIMF with both a financial accelerator and a fully specified banking sector that can make lending losses, and that is regulated according to Basel-III. We illustrate the comparative macroeconomic properties of both models by presenting their responses to a wide range of fiscal, demand, supply and financial shocks.

Suggested Citation

  • Michal Andrle & Mr. Michael Kumhof & Mr. Douglas Laxton & Mr. Dirk V Muir, 2015. "Banks in The Global Integrated Monetary and Fiscal Model," IMF Working Papers 2015/150, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2015/150
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    References listed on IDEAS

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    1. Mr. Derek Anderson & Mr. Benjamin L Hunt & Mika Kortelainen & Mr. Michael Kumhof & Mr. Douglas Laxton & Mr. Dirk V Muir & Susanna Mursula & Stephen Snudden, 2013. "Getting to Know GIMF: The Simulation Properties of the Global Integrated Monetary and Fiscal Model," IMF Working Papers 2013/055, International Monetary Fund.
    2. Robert Kollmann, 2013. "Global Banks, Financial Shocks, and International Business Cycles: Evidence from an Estimated Model," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 45(s2), pages 159-195, December.
    3. Fecht, Falko & Grüner, Hans Peter & Hartmann, Philipp, 2012. "Financial integration, specialization, and systemic risk," Journal of International Economics, Elsevier, vol. 88(1), pages 150-161.
    4. Vasco Cúrdia & Michael Woodford, 2010. "Credit Spreads and Monetary Policy," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 42(s1), pages 3-35, September.
    5. Kumhof, Michael & Laxton, Douglas, 2013. "Fiscal deficits and current account deficits," Journal of Economic Dynamics and Control, Elsevier, vol. 37(10), pages 2062-2082.
    6. Mr. Jaromir Benes & Mr. Michael Kumhof, 2011. "Risky Bank Lending and Optimal Capital Adequacy Regulation," IMF Working Papers 2011/130, International Monetary Fund.
    7. Christiano, Lawrence & Motto, Roberto & Rostagno, Massimo, 2010. "Financial factors in economic fluctuations," Working Paper Series 1192, European Central Bank.
    8. Schooner, Heidi Mandanis & Schooner, Heidi Mandanis & Taylor, Michael W. & Taylor, Michael W., 2009. "Global Bank Regulation," Elsevier Monographs, Elsevier, edition 1, number 9780126410037.
    9. Mr. Douglas Laxton & Mr. Michael Kumhof, 2007. "A Party without a Hangover? On the Effects of U.S. Government Deficits," IMF Working Papers 2007/202, International Monetary Fund.
    10. Mr. Douglas Laxton & Susanna Mursula & Mr. Michael Kumhof & Mr. Dirk V Muir, 2010. "The Global Integrated Monetary and Fiscal Model (GIMF) – Theoretical Structure," IMF Working Papers 2010/034, International Monetary Fund.
    11. Blanchard, Olivier J, 1985. "Debt, Deficits, and Finite Horizons," Journal of Political Economy, University of Chicago Press, vol. 93(2), pages 223-247, April.
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    Cited by:

    1. Wieland, Volker & Binder, Michael & Lieberknecht, Philipp & Quintana, Jorge, 2017. "Model Uncertainty in Macroeconomics: On the Implications of Financial Frictions," CEPR Discussion Papers 12013, C.E.P.R. Discussion Papers.
    2. Linde, Jesper & Smets, Frank & Wouters, Rafael, 2016. "Challenges for Central Banks' Macro Models," CEPR Discussion Papers 11405, C.E.P.R. Discussion Papers.
    3. José R. Maria & Paulo Júlio, 2018. "An integrated financial amplifier: the role of defaulted loans and occasionally binding constraints in output fluctuations," Working Papers w201813, Banco de Portugal, Economics and Research Department.
    4. Júlio, Paulo & Maria, José R., 2024. "The magnifying role of the banking sector during depressions," Journal of Macroeconomics, Elsevier, vol. 79(C).
    5. Lindé, J. & Smets, F. & Wouters, R., 2016. "Challenges for Central Banks’ Macro Models," Handbook of Macroeconomics, in: J. B. Taylor & Harald Uhlig (ed.), Handbook of Macroeconomics, edition 1, volume 2, chapter 0, pages 2185-2262, Elsevier.
    6. Clancy, Daragh & Merola, Rossana, 2017. "Countercyclical capital rules for small open economies," Journal of Macroeconomics, Elsevier, vol. 54(PB), pages 332-351.

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