Monetary Policy in Krugman's Model of a Liquidity Trap

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Uploaded by on Aug 11, 2011

http://demonstrations.wolfram.com/MonetaryPolicyInKrugmansModelOfALiquidityTrap

The Wolfram Demonstrations Project contains thousands of free interactive visualizations, with new entries added daily.

In his 1998 article on the liquidity trap, Paul Krugman presents a simple model. This Demonstration shows how monetary policy affects the level of output and the nominal rate of interest in that model. We see that temporarily increasing the money supply...

Contributed by: Kevin W. Capehart After work by: Paul Krugman

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Education

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