House Price Dynamics, Optimal LTV Limits and the Liquidity Trap.

This paper studies the optimal design of a macro-prudential instrument, a loan-to-value (LTV) limit, and its implications for monetary policy in a model with nominal rigidities and financial frictions. The analysis accounts for both an effective lower bound on the nominal interest rate and an upper...

Full description

Bibliographic Details

Published in:	Review of Economic Studies Vol. 91; no. 2; pp. 940 - 972
Main Authors:	Ferrero, Andrea, Harrison, Richard, Nelson, Benjamin
Format:	Article
Published:	Oxford University Press / USA Mar2024
Subjects:	Financial crises Home prices Interest rates Liquidity (Economics) Monetary policy
Online Access:	View this record in EBSCOhost