Menu Expand

Extraordinary Times Require Extraordinary Action: Boosting European Demand by Means of Investment Helicopter Money

  1. Journals
  2. Economics, Finance, Business & Management
  3. Credit and Capital Markets – Kredit und Kapital
  4. Vol. 54, Issue 2
  5. pp. 137–172

JOURNAL ARTICLE

Cite JOURNAL ARTICLE

Style
Gries, T., Mitschke, A. Extraordinary Times Require Extraordinary Action: Boosting European Demand by Means of Investment Helicopter Money. Credit and Capital Markets – Kredit und Kapital, 54(2), 137-172. https://doi.org/10.3790/ccm.54.2.137
Gries, Thomas and Mitschke, Alexandra "Extraordinary Times Require Extraordinary Action: Boosting European Demand by Means of Investment Helicopter Money" Credit and Capital Markets – Kredit und Kapital 54.2, 2021, 137-172. https://doi.org/10.3790/ccm.54.2.137
Gries, Thomas/Mitschke, Alexandra (2021): Extraordinary Times Require Extraordinary Action: Boosting European Demand by Means of Investment Helicopter Money, in: Credit and Capital Markets – Kredit und Kapital, vol. 54, iss. 2, 137-172, [online] https://doi.org/10.3790/ccm.54.2.137
Format
Download

Extraordinary Times Require Extraordinary Action: Boosting European Demand by Means of Investment Helicopter Money

Gries, Thomas | Mitschke, Alexandra

Credit and Capital Markets – Kredit und Kapital, Vol. 54 (2021), Iss. 2 : pp. 137–172

Read Now Download (PDF)

Additional Information

Article Details

Publisher Name
Duncker & Humblot
DOI
https://doi.org/10.3790/ccm.54.2.137
Language
English
Pages
36
Keywords

Author Details

Prof. Dr. Thomas Gries, Paderborn University, Chair of International Growth and Business Cycle Theory, Warburger Straße 100, 33098 Paderborn.

Alexandra Mitschke, Paderborn University, Chair of International Growth and Business Cycle Theory, Warburger Straße 100, 33098 Paderborn.

References

  1. Acharya, V./Eisert, T./Eufinger, C./Hirsch, C. (2018): Whatever it takes: The real effects of unconventional monetary policy, SAFE Working Paper No. 152.  Google Scholar
  2. Acharya, V./Steffen, S. (2015): The “greatest” carry trade ever? Understanding eurozone bank risks, Journal of Financial Economics, Vol. 115, 215–236.  Google Scholar
  3. Afrouzi, H./Coibion, O./Gorodnichenko, Y./Kumar, S. (2015): Inflation Targeting Does Not Anchor Inflation Expectations: Evidence from Firms in New Zealand, NBER Working Paper Series No. 21814.  Google Scholar
  4. Agarwal, S./Chakraborty, L. (2019): Helicopter Money: A Preliminary Appraisal. MPRA Paper No. 97897, available online: https://mpra.ub.uni-muenchen.de/97897/, accessed February 8, 2020.  Google Scholar
  5. Alesina, A./Tabellini, G. (2007): Bureaucrats or Politicians? Part I: A Single Policy Task, American Economic Review, Vol. 97(1), 169–79.  Google Scholar
  6. Alesina, A./Tabellini, G. (2008): Bureaucrats or Politicians? Part II: Multiple Policy Tasks, Journal of Public Economics, Vol. 92, 426–47.  Google Scholar
  7. Alpanda, S./Kabaca, S. (2020): International Spillovers of Large-Scale Asset Purchases, Journal of European Economic Association, Vol. 18(1), 342–91.  Google Scholar
  8. Altavilla, C./Giannone, D./Lenza, M. (2014): The financial and macroeconomic effects of OMT announcements, ECB Working Paper No. 1707.  Google Scholar
  9. Anderson, V./Cato, M. S. (2015): Green Money: Reclaiming Quantitative Easing. Money Creation for the Common Good. Green/EFA group in the European Parliament, available online: https://mollymep.org.uk/wp-content/uploads/GreenMoney_ReclaimingQE_V.Anderson_June-2015.pdf, accessed October 8, 2019.  Google Scholar
  10. Andrade, P./Galí, J./Le Bihan, H./Matheron, J. (2019): The Optimal Inflation Target and the Natural Rate of Interest, Brookings Papers on Economic Activity. Conference Draft September 5–6, 2019.  Google Scholar
  11. Ball, L./Gagnon, J./Honohan, P./Krogstrup, S. (2016): What Else Can Central Banks Do? Geneva Reports on the World Economy 18. International Center for Monetary and Banking Studies. London.  Google Scholar
  12. Bank of England (1999): The transmission mechanism of monetary policy, The Monetary Policy Committee, available online: https://www.bankofengland.co.uk/-/media/boe/files/quarterly-bulletin/1999/the-transmission-mechanism-of-monetary-policy, accessed October 8, 2019.  Google Scholar
  13. Barigozzi, M./Conti, A. M./Luciani, M. (2014): Do Euro Area Countries Respond Asymmetrically to the Common Monetary Policy?, Oxford Bulletin of Economics and Statistics, Vol. 76(5), 693–714.  Google Scholar
  14. Barro, R. J./Gordon, D. B. (1983): Rules, Discretion and Reputation in a Model of Monetary Policy, Journal of Monetary Economics, Vol. 12(1), 101–121.  Google Scholar
  15. Baumeister, C./Benati, L. (2013): Unconventional Monetary Policy and the Great Recession: Estimating the Macroeconomic Effects of a Spread Compression at the Zero Lower Bound, International Journal of Central Banking, Vol. 9(2), 165–212.  Google Scholar
  16. Belke, A. (2018): Helicopter Money: Should Central Banks Rain Money from the Sky?, Intereconomics, Vol. 53, 34–40.  Google Scholar
  17. Belke, A./Gros, D./Osowski, T. (2017): The Effectiveness of the Fed’s Quantitative Easing Policy: New Evidence Based on Interest Rate Differentials’, Journal of Money and Finance, Vol. 73, 335–49.  Google Scholar
  18. Bernanke, B. (1983): Nonmonetary Effects of the Financial Crisis in the Propagation of the Great Depression, American Economic Review, Vol. 73, 257–76.  Google Scholar
  19. Bernanke, B. (2002): Deflation: Making Sure “It” Doesn’t Happen Here, Remarks held by Governor Ben S. Bernanke at the Federal Reserve Board before the National Economist Club, Washington D.C., on November 21, 2002.  Google Scholar
  20. Bernanke, B. (2016): What tools does the Fed have left? Part 3: Helicopter money, available online: https://www.brookings.edu/blog/ben-bernanke/2016/04/11/what-tools-…2,accessed October 10, 2019.  Google Scholar
  21. Bernanke, B./Gertler, M. (1989): Agency costs, net worth and business fluctuations, American Economic Review, Vol. 79(1), 14–31.  Google Scholar
  22. Bernanke, B./Gertler, M. (1995): Inside the Black Box: The Credit Channel of Monetary Policy Transmission, Journal of Economic Perspectives, Vol. 9(4), Fall 1995, 27–48.  Google Scholar
  23. Board of Governors of the Federal Reserve System (2017): What is the difference between monetary policy and fiscal policy, and how are they related?, available online: https://www.federalreserve.gov/faqs/money_12855.htm, accessed May 15, 2020.  Google Scholar
  24. Boivin, J./Giannoni, M. P./Mojon, B. (2009): How has the monetary transmission mechanism evolved over time?, NBER Working Paper Series No. 15879.  Google Scholar
  25. Boivin, J./Kiley, M. T./Mishkin, F. S. (2011): How Has the Monetary Transmission Mechanism Evolved Over Time? in: Handbook of Monetary Economics, Vol. 3A. Elsevier B.V.  Google Scholar
  26. Borio, C./Disyatat, P. (2009): Unconventional monetary policies: an appraisal, BIS Working Papers No. 292.  Google Scholar
  27. Borio, C./Zabai, A. (2016): Unconventional monetary policies: a re-appraisal, BIS Working Papers No. 570.  Google Scholar
  28. Buiter, W. H. (2014). The Simple Analytics of Helicopter Money: Why it Works – Always, Economics: The Open-Access, Open-Assessment E-Journal, Vol. 8(28).  Google Scholar
  29. Buiter, W. H. (2017): Bad and Good ‚Fiscal Theories of the Price Level’, Citi Research, Multi-Asset, Global Economics View, March 17, 2017.  Google Scholar
  30. Cahn, C./Matheron, J./Sahuc, J.-G. (2017): Assessing the Macroeconomic Effects of LTROs during the Great Recession, Journal of Money, Credit and Banking, Vol. 49(7), 1443–82.  Google Scholar
  31. Carpellini, L./Crosignani, M. (2018): The Design and Transmission of Central Bank Liquidity Provisions, available online: http://matteocrosignani.com/site/wp-content/uploads/2018/08/ecb_design_transmission_aug18.pdf, accessed October 8, 2019.  Google Scholar
  32. Chatelain, J.-B./Generale, A./Hernando, I./von Kalckreuth, U./Vermeulen, P. (2001): Firm Investment and Monetary Policy Transmission in the Euro Area, Economic Research Centre of the Deutsche Bundesbank. Discussion paper No. 20/01.  Google Scholar
  33. Cecchetti, S. G. (1999): Legal Structure, Financial Structure, and the Monetary Policy Transmission Mechanism, FRBNY Economic Policy Review, July 1999, 9–28.  Google Scholar
  34. Chen, H./Cúrdia, V./Ferrero, A. (2012): The Macroeconomic Effects of Large-Scale Asset Purchase Programmes, The Economic Journal, Vol. 1(22) (November).  Google Scholar
  35. Chung, H./Laforte, J.-P./Reifschneider, D./Williams, J. C. (2011): Have We Underestimated the Likelihood and Severity of Zero Lower Bound Events? Federal Reserve Bank of San Francisco Working Paper Series No. 2011-01.  Google Scholar
  36. Ciccarelli, M./Maddaloni, A./Peydró, J.-L. (2015): Trusting the bankers: A new look at the credit channel of monetary policy, Review of Economic Dynamics, Vol. 18, 79–102.  Google Scholar
  37. Clements, B./Kontolemis, Z. G./Levy, J. (2001): Monetary Policy Under EMU: Differences in the Transmission Mechanism? IMF Working Paper No. WP/01/02  Google Scholar
  38. Coppola, F. (2019): The Case for People’s QE. Polity Press, Medford.  Google Scholar
  39. Corbyn, J. (2015): The Economy in 2020, presentation held on July 22, 2015, available online: https://d3n8a8pro7vhmx.cloudfront.net/jeremyforlabour/pages/70/attachments/original/1437556345/TheEconomyIn2020_JeremyCorbyn-220715.pdf?1437556345, accessed October 8, 2019.  Google Scholar
  40. Creel, J./Hubert, P./Viennot, M. (2013): Assessing the interest rate and bank lending channels of ECB monetary policies, OFCE Working Paper No. 2013-25.  Google Scholar
  41. Crosignani, M./Faria-e-Castro, M./Fonseca, L. (2019): The (unintended?) consequences of the largest liquidity injection ever, Journal of Monetary Economics, Vol. 112(C), 97–112.  Google Scholar
  42. Darracq-Paries, M./De Santis, R. A. (2015): A non-standard monetary policy shock: The ECB’s 3-year LTROs and the shift in credit supply, Journal of International Money and Finance, Vol. 54, June 2015, 1–34.  Google Scholar
  43. De Grauwe, P. (2007): There is more to central banking than inflation targeting, available online: https://voxeu.org/article/subprime-crisis-time-inflation-targeting-rethink, accessed October 8, 2019.  Google Scholar
  44. De Grauwe, P./Ji, Y. (2013): Fiscal implications of the ECB’s bond-buying programme, VoxEU, 14 June 2013, available online: http://voxeu.org/article/fiscal-implications-ecb-s-bond-buying-programme, accessed October 8, 2019.  Google Scholar
  45. De Santis, R./Surico, P. (2013): Bank lending and monetary transmission in the Euro Area, ECB Working Paper Series No. 1568.  Google Scholar
  46. Dell’Ariccia, G./Laeven, L./Suarez, G. A. (2016): Bank leverage and monetary policy’s risk-taking channel: evidence from the United States, ECB Working Paper Series No. 1903.  Google Scholar
  47. Deutsche Bank (2016): Helicopters 101: your guide to monetary financing, Deutsche Bank Research, Special Report, available online: https://www.db.com/newsroom_news/GDPBD00000292870.pdf, accessed October 8, 2019.  Google Scholar
  48. Deutsche Bundesbank (2016): The macroeconomic impact of quantitative easing in the euro area, Monthly Report of the Deutsche Bundesbank, June 2016, 29–53.  Google Scholar
  49. Djuric, U./Neugart, M. (2016): Helicopter Money: Survey Evidence on Expectation Formation and Consumption Behavior. Available online: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2893008 , accessed October 8, 2019.  Google Scholar
  50. Draghi, M. (2012): Introductory statement to the press conference, Frankfurt am Main, 9 February 2012, available online: https://www.ecb.europa.eu/press/pressconf/2012/html/is120209.en.html, accessed October 8, 2019.  Google Scholar
  51. Draghi, M. (2014): Monetary policy in the euro area, Opening keynote speech at the Frankfurt European Banking Congress. Frankfurt am Main, November 21, 2014, available online: https://www.ecb.europa.eu/press/key/date/2014/html/sp141121.en.html, accessed April 29, 2020.  Google Scholar
  52. Draghi, M. (2016): ‘Questions and answers following the press conference on March 10th, 2016’, held in Frankfurt am Main, available online: https://www.ecb.europa.eu/press/pressconf/2016/html/is160310.en.html#qa, accessed October 8, 2019.  Google Scholar
  53. Drechsler, I./Drechsel, T./Marques-Ibanez, D./Schnabl, P. (2016): Who Borrows from the Lender of Last Resort?, The Journal of Finance, Vol. 71(5), 1933–74.  Google Scholar
  54. ECB (2010): Monthly Bulletin. May 2010.  Google Scholar
  55. ECB (2011): The Monetary Policy of the ECB. 3rd ed. Frankfurt am Main: European Central Bank.  Google Scholar
  56. ECB (2013): Einleitende Stellungnahme der EZB in dem Verfahren vor dem Bundesverfassungsgericht. Comment of Jörg Asmussen in Karlsruhe on June 11th, 2013, available online: https://www.ecb.europa.eu/press/key/date/2013/html/sp130611.de.html, accessed October 8, 2019.  Google Scholar
  57. ECB (2015): The transmission of the ECB’s recent non-standard monetary policy measures, ECB Economic Bulletin No. 7, 1–20.  Google Scholar
  58. ECB (2019): ‘Transmission mechanism of monetary policy’, available online: https://www.ecb.europa.eu/mopo/intro/transmission/html/index.en.html, accessed October 8, 2019.  Google Scholar
  59. ECB-Statute (2002), available online: https://www.ecb.europa.eu/ecb/pdf/orga/escbstatutes_en.pdf, accessed April 27, 2021.  Google Scholar
  60. Egea, F. B./Hierro, Á. L. (2019): Transmission of monetary policy in the US and EU in times of expansion and crisis, Journal of Policy Modeling, Vol. 41(4), 763–83.  Google Scholar
  61. Eggertsson, G./Woodford, M. (2003): The Zero Bound on Interest Rates and Optimal Monetary Policy, Brookings Papers on Economic Activity, Vol. 34(1), 139–233.  Google Scholar
  62. Ehrmann, M. (2000): Comparing Monetary Policy Transmission across European Countries, Weltwirtschaftliches Archiv, Vol. 136(1), 58–83.  Google Scholar
  63. Elbourne, A./Ji, K./Duijndam, S. (2018): The effects of unconventional monetary policy in the euro area, CPB Discussion Paper No. 371.  Google Scholar
  64. Engen, E. M./Laubach, T./Reifschneider, D. (2015): The Macroeconomic Effects of the Federal Reserves’ Unconventional Monetary Policies. Finance and Economics Discussion Series 2015–005. Washington: Board of Governors of the Federal Reserve System.  Google Scholar
  65. Fawley, B. W./Neely, C. J. (2013): Four Stories of Quantitative Easing, Federal Reserve Bank of St. Louis Review. January/February 2013, Vol. 95(1), 51–88.  Google Scholar
  66. Freixas, J./Rochet, J.-C. (2008): Microeconomics of Banking. 2nd ed. The MIT Press.  Google Scholar
  67. Friedman, M. (1961): The Lag in Effect of Monetary Policy, Journal of Political Economy, Vol. 69(5), 447–66.  Google Scholar
  68. Friedman, M. (1968): The Pole of Monetary Policy. Journal of Political Economy, Vol. 58(1), 1–17.  Google Scholar
  69. Friedman, M. (1969): The Optimum Quantity of Money. Macmillan, London, 296–386.  Google Scholar
  70. Friedman, M. (1972): Have Monetary Policies Failed?, The American Economic Review, Vol. 62(1/2), 11–18.  Google Scholar
  71. Galí, J. (2019): The Effects of a Money-Financed Fiscal Stimulus’, NBER Working Paper Series No. 26249.  Google Scholar
  72. Gambacorta, L./Marques-Ibanez, D. (2011): The Bank Lending Channel: Lessons from the Crisis, Economic Policy, Vol. 26(66), 135–82.  Google Scholar
  73. Gambetti, L./Musso, A. (2017): Loan supply shocks and the business cycle, Journal of Applied Econometrics, Vol. 32(4), 764–82.  Google Scholar
  74. Garcia-Posada, M./Marchetti, M. (2016): The bank lending channel of unconventional monetary policy: The impact of the VLTROs on credit supply in Spain, Banco de Espana Working Paper No. 1512.  Google Scholar
  75. Gern, K.-J./Jannsen, N./Kootha, S./Woltera, M. (2015): Quantitative Easing in the Euro Area: Transmission Channels and Risks, Intereconomics, Vol. 4, 206–12.  Google Scholar
  76. Giavazzi, F./Giovannini, G. (2010): The low-interest-rate trap, VoxEU, available online: https://voxeu.org/node/5309, accessed October 8, 2019.  Google Scholar
  77. Giavazzi, F./Tabellini, G. (2014): How to jumpstart the Eurozone economy, VoxEU, available online: http://www.voxeu.org/article/combatting-eurozone-deflation-qe-people/, accessed October 8, 2019.  Google Scholar
  78. Goodhart, C. A. (2001): Monetary Transmission Lags and the Formulation of the Policy Decision on Interest Rates, Review of the Federal Reserve Bank of St. Louis, Vol. 83(4), 165–86.  Google Scholar
  79. Hachula, M./Piffer, M./Rieth, M. (2020): Unconventional Monetary Policy, Fiscal Side-Effects, and Euro Area (Im)Balances, Journal of the European Economic Association, Vol. 18(1), 202–23.  Google Scholar
  80. Haitsma, R./Ünalmis, D./de Haan, J. (2016): The Impact of the ECB’s Conventional and Unconventional Monetary Policies on Stock Markets, Central Bank of the Republic of Turkey Working Paper No. 16/05.  Google Scholar
  81. Haldane, A. G./Roberts-Sklar, M./Wieladek, T./Young, C. (2016): QE: the story so far, Bank of England Staff Working Paper No. 624.  Google Scholar
  82. Havranek, T./Rusnak, M. (2013): Transmission Lags of Monetary Policy: A Meta-Analysis, International Journal of Central Banking, Vol. 9(4), 39–75.  Google Scholar
  83. Heider, F./Saidi, F./Schepens, G. (2019): Life below Zero: Bank Lending under Negative Policy Rates, The Review of Financial Studies, Vol. 32(10), 3728–61.  Google Scholar
  84. Ireland, P. (2005): The Monetary Transmission Mechanism, Federal Reserve Bank of Boston Working Paper No. 06-1.  Google Scholar
  85. Iskrev, N. (2018): Term premia dynamics in the US and Euro Area; who is leading whom? Bank of Portugal, January, available online: https://www.bportugal.pt/sites/default/files/anexos/papers, accessed October 8, 2019.  Google Scholar
  86. Jackson, A. (2013): Sovereign Money Creation: Paving the Way to a Sustainable Recovery. London: Positive Money.  Google Scholar
  87. Jannsen, S./Bright, I. (2016): Helicopter money: loved, not spent. Europeans doubt effectiveness of helicopter money, ING International Survey special report – Helicopter Money, October 2016.  Google Scholar
  88. Jiménez, G./Ongena, S./Peydró, J.-L/Saurina, J. (2012): Credit supply and monetary policy: Identifying the bank balancesheet channel with loan applications, American Economic Review, Vol. 102(5), 2301-26.  Google Scholar
  89. Jordan, T. J. (2017): Unabhängigkeit von Zentralbanken nach der Finanzkrise: Die Schweizer Perspektive, speech held at CFS Presidential Lectures at Goethe University, Frankfurt, November 9, 2017.  Google Scholar
  90. Jourdan, S. (2017): Helicopter money and basic income: friends or foes? Available online: https://basicincome.org/news/2017/03/helicopter-money-basic-income-friends-or-foes/. Accessed May 5, 2020.  Google Scholar
  91. Joyce, M./Tong, M. (2012): QE and the Gilt Market: A Disaggregated Analysis, The Economic Journal, Vol. 122(564), 348–384.  Google Scholar
  92. Kelton, S. (2020): The Deficit Myth: Modern Monetary Theory and the Birth of the People’s Economy. Public Affairs.  Google Scholar
  93. Kim, S. (1999): Do monetary policy shocks matter in the G-7-countries? Using common identifying assumptions about monetary policy across countries, Journal of International Economics, Vol. 48(2), 387–412.  Google Scholar
  94. Krishnamurthy, A./Vissing-Jorgenson, A. (2011): The Effects of Quantitative Easing on Interest Rates: Channels and Implications for Policy, NBER Working Paper No. 17555.  Google Scholar
  95. Krishnamurthy, A./Nagel, S./Vissing-Jorgenson, A. (2014): ECB Policies Involving Government Bond Purchases: Impact and Channels, Review of Finance, Vol. 22(1), 1–44.  Google Scholar
  96. Krugman, P. (2020): What is Fiscal Policy? available online: https://www.masterclass.com/articles/what-is-fiscal-policy#what-is-the-difference-between-fiscal-policy-and-monetary-policy, accessed May 15, 2020.  Google Scholar
  97. Lavoie, M. (2013): The Monetary and Fiscal Nexus of Neo-Chartalism: A Friendly Critique, Journal of Economic Issues, Vol. 47 (1), 1–32.  Google Scholar
  98. Leeper, E. M./Sims, C. A./Zha, T. (1996): What does monetary policy do?, Brooking Papers on Economic Activity, Vol. 1996(2), 1–78.  Google Scholar
  99. Lehment, H. (2019): Fiscal implications of the ECB’S Public Sector Purchase Programme, Revue de l’OFCE, Hors-série 2019/6, Supp. 2, 89–111.  Google Scholar
  100. Leijonhufvud, A. (2008): Keynes and the Crisis, CEPR Policy Insights, 23, May 2008.  Google Scholar
  101. Martin, C./Milas, C. (2012): Quantitative Easing: a Sceptical Survey, Oxford Review of Economic Policy, Vol. 28(4), Winter 2012, 750–64.  Google Scholar
  102. Mayer, T. (2016): From Zirp, Nirp, QE, and helicopter money to a better monetary system, Economic Policy Note No. 16/3/2016.  Google Scholar
  103. McCallum, B. (2000): Theoretical Analysis Regarding a Zero Lower Bound on Nominal Interest Rates, Journal of Money, Credit and Banking, Vol. 32(4), Nov. 2000, Part 2: Monetary Policy in a Low-Inflation Environment, 870–904.  Google Scholar
  104. McLeay, M./Radia, A./Thomas, R. (2014): Money creation in the modern economy. Bank of England Quarterly Bulletin 2014 Q1, 14–27.  Google Scholar
  105. Mencinger, J. (2017): Universal Basic Income and Helicopter Money, Basic Income Studies, Vol. 12(2), 22–39.  Google Scholar
  106. Mishkin, F. (2010): Monetary policy flexibility, risk management, and financial disruptions, Journal of Asian Economics, Vol. 21(3), 242–246.  Google Scholar
  107. Mitchell, W./Wray, L. R./Watts, M. (2019): Macroeconomics. Red Globe Press.  Google Scholar
  108. Mojon, B./Peersman, G. (2003): A VAR description of the effects of monetary policy in the individual countries of the euro area. in: Angeloni, I., Kayshap, A. K., Mojon, B.: Monetary Policy Transmission in the Euro Area: A Study by the Eurosystem Monetary Transmission Network, 56–74.  Google Scholar
  109. Mojon, B./Smets, F./Vermeulen, P. (2002): Investment and Monetary Policy in the Euro Area, ECB Working Paper Series No. 78.  Google Scholar
  110. Muellbauer, J. (2014): Combatting Eurozone deflation: QE for the people, VoxEU, available online: http://www.voxeu.org/article/combatting-eurozone-deflation-qe-people/, accessed October 8, 2019.  Google Scholar
  111. Neyer, U. (2019): The Independence of the European Central Bank, Credit and Capital Markets, Vol. 52(1), 35–68.  Google Scholar
  112. Palley, T. (2019): What’s Wrong With Modern Money Theory (MMT): A Critical Primer. FMM Working Paper No. 44.  Google Scholar
  113. Pâris, P./Wyplosz; C. (2013): To end the Eurozone crisis, bury the debt forever, VoxEU, available online: https://voxeu.org/article/end-eurozone-crisis-bury-debt-forever, accessed October 8, 2019.  Google Scholar
  114. Peersman, G. (2011): Macroeconomic Effects of Unconventional Monetary Policy in the Euro Area, ECB Working Paper Series No. 1397.  Google Scholar
  115. Praet, P. (2016): Interview with La Repubblica on March 18, 2016, available online: https://www.ecb.europa.eu/press/inter/date/2016/html/sp160318.en.html, accessed October 8, 2019.  Google Scholar
  116. Punzo, C./Rossi L. (2016): Money-Financed versus Debt-Financed Fiscal Stimulus with Borrowing Constraints, University of Pavia, Department of Economics and Management, DEM Working Papers Series No. 131.  Google Scholar
  117. Rogoff, K. (2017): Dealing with Monetary Paralysis at the Zero Bound, Journal of Economic Perspectives, Vol. 31(3), 47–66.  Google Scholar
  118. Rudebusch, G. D./Williams, J. C. (2008): Revealing the Secrets of the Temple: The Value of Publishing Central Bank Interest Rate Projections, Federal Reserve Bank of San Francisco Working Paper Series No. 2006-31.  Google Scholar
  119. Ryan-Collins, J./Werner, R./Greenham, T./Bernando, G. (2013): Strategic quantitative easing: Stimulating investment to rebalance the economy. New economics foundation, London.  Google Scholar
  120. Schenkelberg, H./Watzka, S. (2013): Real effects of quantitative easing at the zero lower bound: Structural VAR-based evidence from Japan, Journal of International Money and Finance, Vol. 33, 327–357.  Google Scholar
  121. Schinasi, G. J./Lutz, M. S. (1991): Fiscal Impulse, IMF Working Paper No. 91.  Google Scholar
  122. Schnabel, I. (2020): How long is the medium term? Monetary policy in a low inflation environment, speech held at the Barclays International Monetary Policy Forum on February 27, 2020, available online: https://www.ecb.europa.eu/press/key/date/2020/html/ecb.sp200227_2~301776ff2a.en.html, accessed April 27, 2020.  Google Scholar
  123. Sester, P. (2012): The ECB’s Controversial Securities Market Programme (SMP) and its role in relation to the modified EFSF and the future ESM, European Company and Financial Law Review, Vol. 9(2), 156–78.  Google Scholar
  124. Sims, C. A. (2001): Fiscal aspects of central bank independence, CESifo Working Paper No. 547.  Google Scholar
  125. Sinn, H.-W. (2017): Helicopter Money. in: Frey, B. S.; Iselin, D. (eds.): Economic Ideas You Should Forget. Heidelberg 2017, Springer, 129–130.  Google Scholar
  126. Spencer, R. W./Yohe, W. P. (1970): The “Crowding Out” of Private Expenditures by Fiscal Policy Actions, Federal Reserve Bank of St. Louis, October 1970, 12–24.  Google Scholar
  127. Summers, L./Stansbury, A. (2019): ‘Why central bankers’ conventional tools are no longer working’, The Guardian 26 Aug 2019, available online: https://www.theguardian.com/business/2019/aug/26/central-bankers-conventional-tools-no-longer-working, accessed February 18, 2020.  Google Scholar
  128. Szczerbowicz, U. (2015): The ECB unconventional monetary policies: have they lowered market borrowing costs for banks and governments?, International Journal of Central Banking, Vol. 11, 91–127.  Google Scholar
  129. Taylor, J. B./Wieland, V. (2012): Surprising Comparative Properties of Monetary Models: Results from a New Model Database, Review of Economics and Statistics, Vol. 94(3), 800–16.  Google Scholar
  130. Treaty on the Functioning of the European Union (TFEU). Official Journal of the European Union C 326/47. October 26, 2012, available online: https://eur-lex.europa.eu/eli/treaty/tfeu_2012/oj, accessed January 1, 2019.  Google Scholar
  131. Trichet, J.-C. (2010): The ECB’s response to the recent tensions in financial market, Speech held at the 38th Economic Conference of the Oesterreichische Nationalbank, Vienna, 31 May 2010, available online: https://www.ecb.europa.eu/press/key/date/2010/html/sp100531_2.en.html, accessed October 8, 2019.  Google Scholar
  132. Turner, A. (2013): ‘Debt, Money, and Mephistopheles: How Do We Get Out of This Mess?’, Group of Thirty Occasional Paper, 87, available online: http://www.group30.org/images/PDF/ReportPDFs/OP%2087.pdf/, accessed October 8, 2019.  Google Scholar
  133. Turner, A. (2015): Between Debt and the Devil: Money, Credit, and Fixing Global Finance. Princeton: University Press.  Google Scholar
  134. Uhlig, H. (2005): What are the effects of monetary policy on output? Results from an agnostic identification procedure, Journal of Monetary Economics, Vol. 52(2), 381–419.  Google Scholar
  135. Van Rooij, M./De Haan, J. (2019): Would helicopter money be spent? New evidence for the Netherlands, Applied Economics, Vol. 51(58), 6171–89.  Google Scholar
  136. Vayanos, D./Vila, J.-L. (2009): ‘A Preferred-Habitat Model of the Term Structure of Interest Rates’, NBER Working Paper Series No. 15487.  Google Scholar
  137. Walsh, C. E. (2008): Central Bank Independence. in: Durlauf, S. N., Blume, I. E. (eds.), The New Palgrave, Dictionary of Economics, 1001–1054. Palgrave Macmillan, Basingstoke.  Google Scholar
  138. Watt, A. (2015): Quantitative easing with bite: a proposal for conditional overt monetary financing of public investment, IMK Working Paper No. 148.  Google Scholar
  139. Weber, A.A./Gerke, R./Worms, A. (2011): Changes in euro area monetary transmission?, Applied Financial Economics, Vol. 21(3), 131–45.  Google Scholar
  140. Woodford, M. (2012): Inflation targeting and financial stability, NBER Working Paper Series No. 17967.  Google Scholar
  141. Wren-Lewis, S. (2014): Helicopter money, available online: https://mainlymacro-blogspots.com/2014/10/helicopter-money.html, accessed October 8, 2019.  Google Scholar
  142. Wright, J. H. (2012): What Does Monetary Policy Do to Long-term Interest Rates at the Zero Lower Bound?, The Economic Journal, Vol. 122(564), 447–66.  Google Scholar
  143. Acharya, V./Eisert, T./Eufinger, C./Hirsch, C. (2018): Whatever it takes: The real effects of unconventional monetary policy, SAFE Working Paper No. 152.  Google Scholar
  144. Acharya, V./Steffen, S. (2015): The “greatest” carry trade ever? Understanding eurozone bank risks, Journal of Financial Economics, Vol. 115, 215–236.  Google Scholar
  145. Afrouzi, H./Coibion, O./Gorodnichenko, Y./Kumar, S. (2015): Inflation Targeting Does Not Anchor Inflation Expectations: Evidence from Firms in New Zealand, NBER Working Paper Series No. 21814.  Google Scholar
  146. Agarwal, S./Chakraborty, L. (2019): Helicopter Money: A Preliminary Appraisal. MPRA Paper No. 97897, available online: https://mpra.ub.uni-muenchen.de/97897/, accessed February 8, 2020.  Google Scholar
  147. Alesina, A./Tabellini, G. (2007): Bureaucrats or Politicians? Part I: A Single Policy Task, American Economic Review, Vol. 97(1), 169–79.  Google Scholar
  148. Alesina, A./Tabellini, G. (2008): Bureaucrats or Politicians? Part II: Multiple Policy Tasks, Journal of Public Economics, Vol. 92, 426–47.  Google Scholar
  149. Alpanda, S./Kabaca, S. (2020): International Spillovers of Large-Scale Asset Purchases, Journal of European Economic Association, Vol. 18(1), 342–91.  Google Scholar
  150. Altavilla, C./Giannone, D./Lenza, M. (2014): The financial and macroeconomic effects of OMT announcements, ECB Working Paper No. 1707.  Google Scholar
  151. Anderson, V./Cato, M. S. (2015): Green Money: Reclaiming Quantitative Easing. Money Creation for the Common Good. Green/EFA group in the European Parliament, available online: https://mollymep.org.uk/wp-content/uploads/GreenMoney_ReclaimingQE_V.Anderson_June-2015.pdf, accessed October 8, 2019.  Google Scholar
  152. Andrade, P./Galí, J./Le Bihan, H./Matheron, J. (2019): The Optimal Inflation Target and the Natural Rate of Interest, Brookings Papers on Economic Activity. Conference Draft September 5–6, 2019.  Google Scholar
  153. Ball, L./Gagnon, J./Honohan, P./Krogstrup, S. (2016): What Else Can Central Banks Do? Geneva Reports on the World Economy 18. International Center for Monetary and Banking Studies. London.  Google Scholar
  154. Bank of England (1999): The transmission mechanism of monetary policy, The Monetary Policy Committee, available online: https://www.bankofengland.co.uk/-/media/boe/files/quarterly-bulletin/1999/the-transmission-mechanism-of-monetary-policy, accessed October 8, 2019.  Google Scholar
  155. Barigozzi, M./Conti, A. M./Luciani, M. (2014): Do Euro Area Countries Respond Asymmetrically to the Common Monetary Policy?, Oxford Bulletin of Economics and Statistics, Vol. 76(5), 693–714.  Google Scholar
  156. Barro, R. J./Gordon, D. B. (1983): Rules, Discretion and Reputation in a Model of Monetary Policy, Journal of Monetary Economics, Vol. 12(1), 101–121.  Google Scholar
  157. Baumeister, C./Benati, L. (2013): Unconventional Monetary Policy and the Great Recession: Estimating the Macroeconomic Effects of a Spread Compression at the Zero Lower Bound, International Journal of Central Banking, Vol. 9(2), 165–212.  Google Scholar
  158. Belke, A. (2018): Helicopter Money: Should Central Banks Rain Money from the Sky?, Intereconomics, Vol. 53, 34–40.  Google Scholar
  159. Belke, A./Gros, D./Osowski, T. (2017): The Effectiveness of the Fed’s Quantitative Easing Policy: New Evidence Based on Interest Rate Differentials’, Journal of Money and Finance, Vol. 73, 335–49.  Google Scholar
  160. Bernanke, B. (1983): Nonmonetary Effects of the Financial Crisis in the Propagation of the Great Depression, American Economic Review, Vol. 73, 257–76.  Google Scholar
  161. Bernanke, B. (2002): Deflation: Making Sure “It” Doesn’t Happen Here, Remarks held by Governor Ben S. Bernanke at the Federal Reserve Board before the National Economist Club, Washington D.C., on November 21, 2002.  Google Scholar
  162. Bernanke, B. (2016): What tools does the Fed have left? Part 3: Helicopter money, available online: https://www.brookings.edu/blog/ben-bernanke/2016/04/11/what-tools-…2,accessed October 10, 2019.  Google Scholar
  163. Bernanke, B./Gertler, M. (1989): Agency costs, net worth and business fluctuations, American Economic Review, Vol. 79(1), 14–31.  Google Scholar
  164. Bernanke, B./Gertler, M. (1995): Inside the Black Box: The Credit Channel of Monetary Policy Transmission, Journal of Economic Perspectives, Vol. 9(4), Fall 1995, 27–48.  Google Scholar
  165. Board of Governors of the Federal Reserve System (2017): What is the difference between monetary policy and fiscal policy, and how are they related?, available online: https://www.federalreserve.gov/faqs/money_12855.htm, accessed May 15, 2020.  Google Scholar
  166. Boivin, J./Giannoni, M. P./Mojon, B. (2009): How has the monetary transmission mechanism evolved over time?, NBER Working Paper Series No. 15879.  Google Scholar
  167. Boivin, J./Kiley, M. T./Mishkin, F. S. (2011): How Has the Monetary Transmission Mechanism Evolved Over Time? in: Handbook of Monetary Economics, Vol. 3A. Elsevier B.V.  Google Scholar
  168. Borio, C./Disyatat, P. (2009): Unconventional monetary policies: an appraisal, BIS Working Papers No. 292.  Google Scholar
  169. Borio, C./Zabai, A. (2016): Unconventional monetary policies: a re-appraisal, BIS Working Papers No. 570.  Google Scholar
  170. Buiter, W. H. (2014). The Simple Analytics of Helicopter Money: Why it Works – Always, Economics: The Open-Access, Open-Assessment E-Journal, Vol. 8(28).  Google Scholar
  171. Buiter, W. H. (2017): Bad and Good ‚Fiscal Theories of the Price Level’, Citi Research, Multi-Asset, Global Economics View, March 17, 2017.  Google Scholar
  172. Cahn, C./Matheron, J./Sahuc, J.-G. (2017): Assessing the Macroeconomic Effects of LTROs during the Great Recession, Journal of Money, Credit and Banking, Vol. 49(7), 1443–82.  Google Scholar
  173. Carpellini, L./Crosignani, M. (2018): The Design and Transmission of Central Bank Liquidity Provisions, available online: http://matteocrosignani.com/site/wp-content/uploads/2018/08/ecb_design_transmission_aug18.pdf, accessed October 8, 2019.  Google Scholar
  174. Chatelain, J.-B./Generale, A./Hernando, I./von Kalckreuth, U./Vermeulen, P. (2001): Firm Investment and Monetary Policy Transmission in the Euro Area, Economic Research Centre of the Deutsche Bundesbank. Discussion paper No. 20/01.  Google Scholar
  175. Cecchetti, S. G. (1999): Legal Structure, Financial Structure, and the Monetary Policy Transmission Mechanism, FRBNY Economic Policy Review, July 1999, 9–28.  Google Scholar
  176. Chen, H./Cúrdia, V./Ferrero, A. (2012): The Macroeconomic Effects of Large-Scale Asset Purchase Programmes, The Economic Journal, Vol. 1(22) (November).  Google Scholar
  177. Chung, H./Laforte, J.-P./Reifschneider, D./Williams, J. C. (2011): Have We Underestimated the Likelihood and Severity of Zero Lower Bound Events? Federal Reserve Bank of San Francisco Working Paper Series No. 2011-01.  Google Scholar
  178. Ciccarelli, M./Maddaloni, A./Peydró, J.-L. (2015): Trusting the bankers: A new look at the credit channel of monetary policy, Review of Economic Dynamics, Vol. 18, 79–102.  Google Scholar
  179. Clements, B./Kontolemis, Z. G./Levy, J. (2001): Monetary Policy Under EMU: Differences in the Transmission Mechanism? IMF Working Paper No. WP/01/02  Google Scholar
  180. Coppola, F. (2019): The Case for People’s QE. Polity Press, Medford.  Google Scholar
  181. Corbyn, J. (2015): The Economy in 2020, presentation held on July 22, 2015, available online: https://d3n8a8pro7vhmx.cloudfront.net/jeremyforlabour/pages/70/attachments/original/1437556345/TheEconomyIn2020_JeremyCorbyn-220715.pdf?1437556345, accessed October 8, 2019.  Google Scholar
  182. Creel, J./Hubert, P./Viennot, M. (2013): Assessing the interest rate and bank lending channels of ECB monetary policies, OFCE Working Paper No. 2013-25.  Google Scholar
  183. Crosignani, M./Faria-e-Castro, M./Fonseca, L. (2019): The (unintended?) consequences of the largest liquidity injection ever, Journal of Monetary Economics, Vol. 112(C), 97–112.  Google Scholar
  184. Darracq-Paries, M./De Santis, R. A. (2015): A non-standard monetary policy shock: The ECB’s 3-year LTROs and the shift in credit supply, Journal of International Money and Finance, Vol. 54, June 2015, 1–34.  Google Scholar
  185. De Grauwe, P. (2007): There is more to central banking than inflation targeting, available online: https://voxeu.org/article/subprime-crisis-time-inflation-targeting-rethink, accessed October 8, 2019.  Google Scholar
  186. De Grauwe, P./Ji, Y. (2013): Fiscal implications of the ECB’s bond-buying programme, VoxEU, 14 June 2013, available online: http://voxeu.org/article/fiscal-implications-ecb-s-bond-buying-programme, accessed October 8, 2019.  Google Scholar
  187. De Santis, R./Surico, P. (2013): Bank lending and monetary transmission in the Euro Area, ECB Working Paper Series No. 1568.  Google Scholar
  188. Dell’Ariccia, G./Laeven, L./Suarez, G. A. (2016): Bank leverage and monetary policy’s risk-taking channel: evidence from the United States, ECB Working Paper Series No. 1903.  Google Scholar
  189. Deutsche Bank (2016): Helicopters 101: your guide to monetary financing, Deutsche Bank Research, Special Report, available online: https://www.db.com/newsroom_news/GDPBD00000292870.pdf, accessed October 8, 2019.  Google Scholar
  190. Deutsche Bundesbank (2016): The macroeconomic impact of quantitative easing in the euro area, Monthly Report of the Deutsche Bundesbank, June 2016, 29–53.  Google Scholar
  191. Djuric, U./Neugart, M. (2016): Helicopter Money: Survey Evidence on Expectation Formation and Consumption Behavior. Available online: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2893008 , accessed October 8, 2019.  Google Scholar
  192. Draghi, M. (2012): Introductory statement to the press conference, Frankfurt am Main, 9 February 2012, available online: https://www.ecb.europa.eu/press/pressconf/2012/html/is120209.en.html, accessed October 8, 2019.  Google Scholar
  193. Draghi, M. (2014): Monetary policy in the euro area, Opening keynote speech at the Frankfurt European Banking Congress. Frankfurt am Main, November 21, 2014, available online: https://www.ecb.europa.eu/press/key/date/2014/html/sp141121.en.html, accessed April 29, 2020.  Google Scholar
  194. Draghi, M. (2016): ‘Questions and answers following the press conference on March 10th, 2016’, held in Frankfurt am Main, available online: https://www.ecb.europa.eu/press/pressconf/2016/html/is160310.en.html#qa, accessed October 8, 2019.  Google Scholar
  195. Drechsler, I./Drechsel, T./Marques-Ibanez, D./Schnabl, P. (2016): Who Borrows from the Lender of Last Resort?, The Journal of Finance, Vol. 71(5), 1933–74.  Google Scholar
  196. ECB (2010): Monthly Bulletin. May 2010.  Google Scholar
  197. ECB (2011): The Monetary Policy of the ECB. 3rd ed. Frankfurt am Main: European Central Bank.  Google Scholar
  198. ECB (2013): Einleitende Stellungnahme der EZB in dem Verfahren vor dem Bundesverfassungsgericht. Comment of Jörg Asmussen in Karlsruhe on June 11th, 2013, available online: https://www.ecb.europa.eu/press/key/date/2013/html/sp130611.de.html, accessed October 8, 2019.  Google Scholar
  199. ECB (2015): The transmission of the ECB’s recent non-standard monetary policy measures, ECB Economic Bulletin No. 7, 1–20.  Google Scholar
  200. ECB (2019): ‘Transmission mechanism of monetary policy’, available online: https://www.ecb.europa.eu/mopo/intro/transmission/html/index.en.html, accessed October 8, 2019.  Google Scholar
  201. ECB-Statute (2002), available online: https://www.ecb.europa.eu/ecb/pdf/orga/escbstatutes_en.pdf, accessed April 27, 2021.  Google Scholar
  202. Egea, F. B./Hierro, Á. L. (2019): Transmission of monetary policy in the US and EU in times of expansion and crisis, Journal of Policy Modeling, Vol. 41(4), 763–83.  Google Scholar
  203. Eggertsson, G./Woodford, M. (2003): The Zero Bound on Interest Rates and Optimal Monetary Policy, Brookings Papers on Economic Activity, Vol. 34(1), 139–233.  Google Scholar
  204. Ehrmann, M. (2000): Comparing Monetary Policy Transmission across European Countries, Weltwirtschaftliches Archiv, Vol. 136(1), 58–83.  Google Scholar
  205. Elbourne, A./Ji, K./Duijndam, S. (2018): The effects of unconventional monetary policy in the euro area, CPB Discussion Paper No. 371.  Google Scholar
  206. Engen, E. M./Laubach, T./Reifschneider, D. (2015): The Macroeconomic Effects of the Federal Reserves’ Unconventional Monetary Policies. Finance and Economics Discussion Series 2015–005. Washington: Board of Governors of the Federal Reserve System.  Google Scholar
  207. Fawley, B. W./Neely, C. J. (2013): Four Stories of Quantitative Easing, Federal Reserve Bank of St. Louis Review. January/February 2013, Vol. 95(1), 51–88.  Google Scholar
  208. Freixas, J./Rochet, J.-C. (2008): Microeconomics of Banking. 2nd ed. The MIT Press.  Google Scholar
  209. Friedman, M. (1961): The Lag in Effect of Monetary Policy, Journal of Political Economy, Vol. 69(5), 447–66.  Google Scholar
  210. Friedman, M. (1968): The Pole of Monetary Policy. Journal of Political Economy, Vol. 58(1), 1–17.  Google Scholar
  211. Friedman, M. (1969): The Optimum Quantity of Money. Macmillan, London, 296–386.  Google Scholar
  212. Friedman, M. (1972): Have Monetary Policies Failed?, The American Economic Review, Vol. 62(1/2), 11–18.  Google Scholar
  213. Galí, J. (2019): The Effects of a Money-Financed Fiscal Stimulus’, NBER Working Paper Series No. 26249.  Google Scholar
  214. Gambacorta, L./Marques-Ibanez, D. (2011): The Bank Lending Channel: Lessons from the Crisis, Economic Policy, Vol. 26(66), 135–82.  Google Scholar
  215. Gambetti, L./Musso, A. (2017): Loan supply shocks and the business cycle, Journal of Applied Econometrics, Vol. 32(4), 764–82.  Google Scholar
  216. Garcia-Posada, M./Marchetti, M. (2016): The bank lending channel of unconventional monetary policy: The impact of the VLTROs on credit supply in Spain, Banco de Espana Working Paper No. 1512.  Google Scholar
  217. Gern, K.-J./Jannsen, N./Kootha, S./Woltera, M. (2015): Quantitative Easing in the Euro Area: Transmission Channels and Risks, Intereconomics, Vol. 4, 206–12.  Google Scholar
  218. Giavazzi, F./Giovannini, G. (2010): The low-interest-rate trap, VoxEU, available online: https://voxeu.org/node/5309, accessed October 8, 2019.  Google Scholar
  219. Giavazzi, F./Tabellini, G. (2014): How to jumpstart the Eurozone economy, VoxEU, available online: http://www.voxeu.org/article/combatting-eurozone-deflation-qe-people/, accessed October 8, 2019.  Google Scholar
  220. Goodhart, C. A. (2001): Monetary Transmission Lags and the Formulation of the Policy Decision on Interest Rates, Review of the Federal Reserve Bank of St. Louis, Vol. 83(4), 165–86.  Google Scholar
  221. Hachula, M./Piffer, M./Rieth, M. (2020): Unconventional Monetary Policy, Fiscal Side-Effects, and Euro Area (Im)Balances, Journal of the European Economic Association, Vol. 18(1), 202–23.  Google Scholar
  222. Haitsma, R./Ünalmis, D./de Haan, J. (2016): The Impact of the ECB’s Conventional and Unconventional Monetary Policies on Stock Markets, Central Bank of the Republic of Turkey Working Paper No. 16/05.  Google Scholar
  223. Haldane, A. G./Roberts-Sklar, M./Wieladek, T./Young, C. (2016): QE: the story so far, Bank of England Staff Working Paper No. 624.  Google Scholar
  224. Havranek, T./Rusnak, M. (2013): Transmission Lags of Monetary Policy: A Meta-Analysis, International Journal of Central Banking, Vol. 9(4), 39–75.  Google Scholar
  225. Heider, F./Saidi, F./Schepens, G. (2019): Life below Zero: Bank Lending under Negative Policy Rates, The Review of Financial Studies, Vol. 32(10), 3728–61.  Google Scholar
  226. Ireland, P. (2005): The Monetary Transmission Mechanism, Federal Reserve Bank of Boston Working Paper No. 06-1.  Google Scholar
  227. Iskrev, N. (2018): Term premia dynamics in the US and Euro Area; who is leading whom? Bank of Portugal, January, available online: https://www.bportugal.pt/sites/default/files/anexos/papers, accessed October 8, 2019.  Google Scholar
  228. Jackson, A. (2013): Sovereign Money Creation: Paving the Way to a Sustainable Recovery. London: Positive Money.  Google Scholar
  229. Jannsen, S./Bright, I. (2016): Helicopter money: loved, not spent. Europeans doubt effectiveness of helicopter money, ING International Survey special report – Helicopter Money, October 2016.  Google Scholar
  230. Jiménez, G./Ongena, S./Peydró, J.-L/Saurina, J. (2012): Credit supply and monetary policy: Identifying the bank balancesheet channel with loan applications, American Economic Review, Vol. 102(5), 2301-26.  Google Scholar
  231. Jordan, T. J. (2017): Unabhängigkeit von Zentralbanken nach der Finanzkrise: Die Schweizer Perspektive, speech held at CFS Presidential Lectures at Goethe University, Frankfurt, November 9, 2017.  Google Scholar
  232. Jourdan, S. (2017): Helicopter money and basic income: friends or foes? Available online: https://basicincome.org/news/2017/03/helicopter-money-basic-income-friends-or-foes/. Accessed May 5, 2020.  Google Scholar
  233. Joyce, M./Tong, M. (2012): QE and the Gilt Market: A Disaggregated Analysis, The Economic Journal, Vol. 122(564), 348–384.  Google Scholar
  234. Kelton, S. (2020): The Deficit Myth: Modern Monetary Theory and the Birth of the People’s Economy. Public Affairs.  Google Scholar
  235. Kim, S. (1999): Do monetary policy shocks matter in the G-7-countries? Using common identifying assumptions about monetary policy across countries, Journal of International Economics, Vol. 48(2), 387–412.  Google Scholar
  236. Krishnamurthy, A./Vissing-Jorgenson, A. (2011): The Effects of Quantitative Easing on Interest Rates: Channels and Implications for Policy, NBER Working Paper No. 17555.  Google Scholar
  237. Krishnamurthy, A./Nagel, S./Vissing-Jorgenson, A. (2014): ECB Policies Involving Government Bond Purchases: Impact and Channels, Review of Finance, Vol. 22(1), 1–44.  Google Scholar
  238. Krugman, P. (2020): What is Fiscal Policy? available online: https://www.masterclass.com/articles/what-is-fiscal-policy#what-is-the-difference-between-fiscal-policy-and-monetary-policy, accessed May 15, 2020.  Google Scholar
  239. Lavoie, M. (2013): The Monetary and Fiscal Nexus of Neo-Chartalism: A Friendly Critique, Journal of Economic Issues, Vol. 47 (1), 1–32.  Google Scholar
  240. Leeper, E. M./Sims, C. A./Zha, T. (1996): What does monetary policy do?, Brooking Papers on Economic Activity, Vol. 1996(2), 1–78.  Google Scholar
  241. Lehment, H. (2019): Fiscal implications of the ECB’S Public Sector Purchase Programme, Revue de l’OFCE, Hors-série 2019/6, Supp. 2, 89–111.  Google Scholar
  242. Leijonhufvud, A. (2008): Keynes and the Crisis, CEPR Policy Insights, 23, May 2008.  Google Scholar
  243. Martin, C./Milas, C. (2012): Quantitative Easing: a Sceptical Survey, Oxford Review of Economic Policy, Vol. 28(4), Winter 2012, 750–64.  Google Scholar
  244. Mayer, T. (2016): From Zirp, Nirp, QE, and helicopter money to a better monetary system, Economic Policy Note No. 16/3/2016.  Google Scholar
  245. McCallum, B. (2000): Theoretical Analysis Regarding a Zero Lower Bound on Nominal Interest Rates, Journal of Money, Credit and Banking, Vol. 32(4), Nov. 2000, Part 2: Monetary Policy in a Low-Inflation Environment, 870–904.  Google Scholar
  246. McLeay, M./Radia, A./Thomas, R. (2014): Money creation in the modern economy. Bank of England Quarterly Bulletin 2014 Q1, 14–27.  Google Scholar
  247. Mencinger, J. (2017): Universal Basic Income and Helicopter Money, Basic Income Studies, Vol. 12(2), 22–39.  Google Scholar
  248. Mishkin, F. (2010): Monetary policy flexibility, risk management, and financial disruptions, Journal of Asian Economics, Vol. 21(3), 242–246.  Google Scholar
  249. Mitchell, W./Wray, L. R./Watts, M. (2019): Macroeconomics. Red Globe Press.  Google Scholar
  250. Mojon, B./Peersman, G. (2003): A VAR description of the effects of monetary policy in the individual countries of the euro area. in: Angeloni, I., Kayshap, A. K., Mojon, B.: Monetary Policy Transmission in the Euro Area: A Study by the Eurosystem Monetary Transmission Network, 56–74.  Google Scholar
  251. Mojon, B./Smets, F./Vermeulen, P. (2002): Investment and Monetary Policy in the Euro Area, ECB Working Paper Series No. 78.  Google Scholar
  252. Muellbauer, J. (2014): Combatting Eurozone deflation: QE for the people, VoxEU, available online: http://www.voxeu.org/article/combatting-eurozone-deflation-qe-people/, accessed October 8, 2019.  Google Scholar
  253. Neyer, U. (2019): The Independence of the European Central Bank, Credit and Capital Markets, Vol. 52(1), 35–68.  Google Scholar
  254. Palley, T. (2019): What’s Wrong With Modern Money Theory (MMT): A Critical Primer. FMM Working Paper No. 44.  Google Scholar
  255. Pâris, P./Wyplosz; C. (2013): To end the Eurozone crisis, bury the debt forever, VoxEU, available online: https://voxeu.org/article/end-eurozone-crisis-bury-debt-forever, accessed October 8, 2019.  Google Scholar
  256. Peersman, G. (2011): Macroeconomic Effects of Unconventional Monetary Policy in the Euro Area, ECB Working Paper Series No. 1397.  Google Scholar
  257. Praet, P. (2016): Interview with La Repubblica on March 18, 2016, available online: https://www.ecb.europa.eu/press/inter/date/2016/html/sp160318.en.html, accessed October 8, 2019.  Google Scholar
  258. Punzo, C./Rossi L. (2016): Money-Financed versus Debt-Financed Fiscal Stimulus with Borrowing Constraints, University of Pavia, Department of Economics and Management, DEM Working Papers Series No. 131.  Google Scholar
  259. Rogoff, K. (2017): Dealing with Monetary Paralysis at the Zero Bound, Journal of Economic Perspectives, Vol. 31(3), 47–66.  Google Scholar
  260. Rudebusch, G. D./Williams, J. C. (2008): Revealing the Secrets of the Temple: The Value of Publishing Central Bank Interest Rate Projections, Federal Reserve Bank of San Francisco Working Paper Series No. 2006-31.  Google Scholar
  261. Ryan-Collins, J./Werner, R./Greenham, T./Bernando, G. (2013): Strategic quantitative easing: Stimulating investment to rebalance the economy. New economics foundation, London.  Google Scholar
  262. Schenkelberg, H./Watzka, S. (2013): Real effects of quantitative easing at the zero lower bound: Structural VAR-based evidence from Japan, Journal of International Money and Finance, Vol. 33, 327–357.  Google Scholar
  263. Schinasi, G. J./Lutz, M. S. (1991): Fiscal Impulse, IMF Working Paper No. 91.  Google Scholar
  264. Schnabel, I. (2020): How long is the medium term? Monetary policy in a low inflation environment, speech held at the Barclays International Monetary Policy Forum on February 27, 2020, available online: https://www.ecb.europa.eu/press/key/date/2020/html/ecb.sp200227_2~301776ff2a.en.html, accessed April 27, 2020.  Google Scholar
  265. Sester, P. (2012): The ECB’s Controversial Securities Market Programme (SMP) and its role in relation to the modified EFSF and the future ESM, European Company and Financial Law Review, Vol. 9(2), 156–78.  Google Scholar
  266. Sims, C. A. (2001): Fiscal aspects of central bank independence, CESifo Working Paper No. 547.  Google Scholar
  267. Sinn, H.-W. (2017): Helicopter Money. in: Frey, B. S.; Iselin, D. (eds.): Economic Ideas You Should Forget. Heidelberg 2017, Springer, 129–130.  Google Scholar
  268. Spencer, R. W./Yohe, W. P. (1970): The “Crowding Out” of Private Expenditures by Fiscal Policy Actions, Federal Reserve Bank of St. Louis, October 1970, 12–24.  Google Scholar
  269. Summers, L./Stansbury, A. (2019): ‘Why central bankers’ conventional tools are no longer working’, The Guardian 26 Aug 2019, available online: https://www.theguardian.com/business/2019/aug/26/central-bankers-conventional-tools-no-longer-working, accessed February 18, 2020.  Google Scholar
  270. Szczerbowicz, U. (2015): The ECB unconventional monetary policies: have they lowered market borrowing costs for banks and governments?, International Journal of Central Banking, Vol. 11, 91–127.  Google Scholar
  271. Taylor, J. B./Wieland, V. (2012): Surprising Comparative Properties of Monetary Models: Results from a New Model Database, Review of Economics and Statistics, Vol. 94(3), 800–16.  Google Scholar
  272. Treaty on the Functioning of the European Union (TFEU). Official Journal of the European Union C 326/47. October 26, 2012, available online: https://eur-lex.europa.eu/eli/treaty/tfeu_2012/oj, accessed January 1, 2019.  Google Scholar
  273. Trichet, J.-C. (2010): The ECB’s response to the recent tensions in financial market, Speech held at the 38th Economic Conference of the Oesterreichische Nationalbank, Vienna, 31 May 2010, available online: https://www.ecb.europa.eu/press/key/date/2010/html/sp100531_2.en.html, accessed October 8, 2019.  Google Scholar
  274. Turner, A. (2013): ‘Debt, Money, and Mephistopheles: How Do We Get Out of This Mess?’, Group of Thirty Occasional Paper, 87, available online: http://www.group30.org/images/PDF/ReportPDFs/OP%2087.pdf/, accessed October 8, 2019.  Google Scholar
  275. Turner, A. (2015): Between Debt and the Devil: Money, Credit, and Fixing Global Finance. Princeton: University Press.  Google Scholar
  276. Uhlig, H. (2005): What are the effects of monetary policy on output? Results from an agnostic identification procedure, Journal of Monetary Economics, Vol. 52(2), 381–419.  Google Scholar
  277. Van Rooij, M./De Haan, J. (2019): Would helicopter money be spent? New evidence for the Netherlands, Applied Economics, Vol. 51(58), 6171–89.  Google Scholar
  278. Vayanos, D./Vila, J.-L. (2009): ‘A Preferred-Habitat Model of the Term Structure of Interest Rates’, NBER Working Paper Series No. 15487.  Google Scholar
  279. Walsh, C. E. (2008): Central Bank Independence. in: Durlauf, S. N., Blume, I. E. (eds.), The New Palgrave, Dictionary of Economics, 1001–1054. Palgrave Macmillan, Basingstoke.  Google Scholar
  280. Watt, A. (2015): Quantitative easing with bite: a proposal for conditional overt monetary financing of public investment, IMK Working Paper No. 148.  Google Scholar
  281. Weber, A.A./Gerke, R./Worms, A. (2011): Changes in euro area monetary transmission?, Applied Financial Economics, Vol. 21(3), 131–45.  Google Scholar
  282. Woodford, M. (2012): Inflation targeting and financial stability, NBER Working Paper Series No. 17967.  Google Scholar
  283. Wren-Lewis, S. (2014): Helicopter money, available online: https://mainlymacro-blogspots.com/2014/10/helicopter-money.html, accessed October 8, 2019.  Google Scholar
  284. Wright, J. H. (2012): What Does Monetary Policy Do to Long-term Interest Rates at the Zero Lower Bound?, The Economic Journal, Vol. 122(564), 447–66.  Google Scholar

Abstract

This theoretical contribution analyzes remaining monetary policy tools and their ability to reestablish sound macroeconomic conditions in the euro area. Motivated by the observation of a lack of investment in the macroeconomy and subdued inflation, we review current monetary policy challenges and emphasize the major failure of traditional transmission channels. While interest rates and asset prices often respond to central bank tools, the effects on the real economy, specifically on investments, are often not observable. We suggest Investment Helicopter Money as a tool to directly strengthen investment and boost aggregate demand. This monetary impulse is found to offer a direct real effect without crowding-out investment or rising debt levels. Most importantly, we discuss necessary institutional arrangements and contrast the suggested tool with a simple monetary or fiscal impulse.

Table of Contents

Section Title Page Action Price
Thomas Gries / Alexandra Mitschke: Extraordinary Times Require Extraordinary Action: Boosting European Demand by Means of Investment Helicopter Money 1
Abstract 1
I. Introduction: Challenges of Monetary Policy 2
II. Transmission Channels and Real Effectiveness 3
1. Conventional Monetary Policy 3
a) Mechanics and Adjustment Time 3
b) Shortcomings and Restrictions 5
c) Empirical Appraisal 5
2. Unconventional Monetary Policy 6
a) Mechanics and Adjustment Time 7
b) Shortcomings and Restrictions 8
c) Empirical Appraisal 8
III. Helicopter Money 1
1. Traditional Helicopter Money 1
a) Mechanics and Adjustment Time 1
b) Shortcomings and Restrictions 1
2. Investment Helicopter Money 1
a) Mechanics of Investment Helicopter Money 1
b) Shortcomings and Restrictions 1
3. Comparisons of Helicopter Money with Other Policy Tools 1
a) Helicopter Money vs. CMP 1
b) Helicopter Money vs. QE 1
c) Helicopter Money vs. Traditional Fiscal Stimulus 1
IV. Discussion 2
1. Concepts: Fiscal or Monetary Policy? 2
2. Central Bank Independence 2
V. Concluding Remarks 2
References 2
Appendix: Timeline of QE in the Eurozone 3

Contact

Duncker & Humblot GmbH Carl-Heinrich-Becker-Weg 9 12165 Berlin, Deutschland T: +49 30 790006-0

Quick Navigation

2024 Duncker & Humblot GmbH

Powered by CloudPublish

We use cookies to ensure that you get the best experience on our website. Learn more about how we use cookies.