The Stock Market Channel of Monetary Policy /
This paper argues that the stock market is an important channel of monetary policy. Monetary policy affects real economic activity because inflation levies a property tax on stocks in addition to an income tax on dividend payments. Inflation thus taxes stocks more heavily than it does bonds. Househo...
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| Kolejni autorzy: | , |
| Format: | Czasopismo |
| Język: | English |
| Wydane: |
Washington, D.C. :
International Monetary Fund,
1999.
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| Seria: | IMF Working Papers; Working Paper ;
No. 1999/022 |
| Dostęp online: | Full text available on IMF |
| Streszczenie: | This paper argues that the stock market is an important channel of monetary policy. Monetary policy affects real economic activity because inflation levies a property tax on stocks in addition to an income tax on dividend payments. Inflation thus taxes stocks more heavily than it does bonds. Households alter their required rate of return as inflation changes, and firms adjust production in order to satisfy their shareholders' demands. As the stock market channel grows in importance, the appropriate intermediate target for the central bank is the price level, with price stability being the ultimate goal. |
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| Deskrypcja: | <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required |
| Opis fizyczny: | 1 online resource (25 pages) |
| Format: | Mode of access: Internet |
| ISSN: | 1018-5941 |
| Ograniczenie dostępu: | Electronic access restricted to authorized BRAC University faculty, staff and students |