Monetary Policy and Economic Performance Since the Financial Crisis

RePEc Short ID: pca683
ORCID iD: 0000-0002-2252-7079

Caldara, Dario; Gagnon, Etienne; Martínez García, Enrique; Neely, Christopher J.

doi:10.24149/gwp399

Working Paper

Monetary Policy and Economic Performance Since the Financial Crisis

Abstract: We review the macroeconomic performance over the period since the Global Financial Crisis and the challenges in the pursuit of the Federal Reserve’s dual mandate. We characterize the use of forward guidance and balance sheet policies after the federal funds rate reached the effective lower bound. We also review the evidence on the efficacy of these tools and consider whether policymakers might have used them more forcefully. Finally, we examine the post-crisis experience of other major central banks with these policy tools.

Keywords: Global Financial Crisis 2007–09; monetary policy; effective lower bound; structural changes; forward guidance; balance sheet policies;

JEL Classification: E31; E32; E52; E58;

https://doi.org/10.24149/gwp399