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Households heterogeneity in a global CGE model: Les effets des politiques de Quantitative Easing sur le taux de change : les enseignements de l’expérience américaine

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  • Michel Dupuy

    (Larefi, Université de Bordeaux)

Abstract

Facing liquidity trap problems, a number of industrialised countries, including the United States and the United Kingdom, have since 2008 implemented Quantitative Easing (QE) measures in an attempt to improve financing conditions in their overall economy. Although Quantitative Easing policies primarily act upon long-term interest rates and asset prices, they also have secondary effects on exchange rates. In a "currency war" context, some countries might be tempted to use QE as a protectionist weapon in a bid to achieve exchange rate depreciation. After identifying which QE transmission channels affect exchange rates, the paper proposes an empirical analysis of stylized facts and econometric tests on the United States.

Suggested Citation

  • Michel Dupuy, 2013. "Households heterogeneity in a global CGE model: Les effets des politiques de Quantitative Easing sur le taux de change : les enseignements de l’expérience américaine," Larefi Working Papers 1302, Larefi, Université Bordeaux 4.
    • Handle: RePEc:laf:wpaper:cr1302
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    File URL: http://laf.u-bordeaux4.fr/RePEc/CR_13EFI02.pdf
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    References listed on IDEAS

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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Quantitative Easing; exchange rate; monetary base; long-term interest rates;
    All these keywords.

    JEL classification:

    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

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