Turnover liquidity and the transmission of monetary policy
Lagos, R. & Zhang, S.
(2020).
Turnover liquidity and the transmission of monetary policy.
American Economic Review,
110(6), 1635 - 1672.
https://doi.org/10.1257/aer.20170045
(2020).
Turnover liquidity and the transmission of monetary policy.
American Economic Review,
110(6), 1635 - 1672.
https://doi.org/10.1257/aer.20170045
We provide empirical evidence of a novel liquidity-based transmission mechanism through which monetary policy influences asset markets, develop a model of this mechanism, and assess the ability of the quantitative theory to match the evidence.