Negative Interest Rate Policy as Conventional Monetary Policy Journal Article uri icon



  • As long as all interest rates move in tandem – including the rate of return on paper currency – economic theory suggests no important difference between interest rate changes in the positive region and interest rate changes in the negative region. Indeed, in standard models, only the real interest rate and spreads between real interest rates matter. Thus, in most respects, negative interest rate policy is conventional. It is only (a) what needs to be done with paper currency, (b) difficulties in understanding negative rates or (c) institutional features interacting with negative rates that make negative interest rate policy unconventional.

publication date

  • November 1, 2015

has restriction

  • closed

Date in CU Experts

  • March 12, 2017 2:07 AM

Full Author List

  • Kimball MS

author count

  • 1

Other Profiles

International Standard Serial Number (ISSN)

  • 0027-9501

Electronic International Standard Serial Number (EISSN)

  • 1741-3036

Additional Document Info

start page

  • R5

end page

  • R14


  • 234