Negative Interest Rates and Housing Bubbles

Result code in IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F04274644%3A_____%2F16%3A%230000176" target="_blank" >RIV/04274644:_____/16:#0000176 - isvavai.cz</a>

Alternative codes found

RIV/68407700:21110/16:00306678

Result on the web

<a href="http://www.civilengineeringjournal.cz/archive/issues/2016/2016_4/4-2016-0020.pdf" target="_blank" >http://www.civilengineeringjournal.cz/archive/issues/2016/2016_4/4-2016-0020.pdf</a>

DOI - Digital Object Identifier

<a href="http://dx.doi.org/10.14311/CEJ.2016.04.0020" target="_blank" >10.14311/CEJ.2016.04.0020</a>

Result language

angličtina

Original language name

Negative Interest Rates and Housing Bubbles

Original language description

In years after the financial crisis economists started to propose negative interest rates as a way how to escape from a liquidity trap. Negative interest rate was considered to be impossible but few countries have already set them below the lower zero bound. However, it has been done only in the central banks but not in the commercial banks. The main thesis of this paper is that low interest rates can inflate a housing bubble and as a result negative interest rates would only inflate it more. First, proposals how to make interest rate negative even in commercial banking are presented in the paper. Then we discuss general consequences of negative interest rates such as redistribution, initiation of a business cycle and most importantly, inflation. Finally, we look at the housing market and present theoretical and some empirical evidence of a possible ongoing bubble. The theory suggests that the negative interest rate would inflate the bubble necessarily.

Czech name

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Czech description

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Type

J_x - Unclassified - Peer-reviewed scientific article (Jimp, Jsc and Jost)

CEP classification

AH - Economics

OECD FORD branch

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Project

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Continuities

I - Institucionalni podpora na dlouhodoby koncepcni rozvoj vyzkumne organizace

Publication year

2016

Confidentiality

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Name of the periodical

Civic Engineering Journal

ISSN

1805-2576

e-ISSN

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Volume of the periodical

2016

Issue of the periodical within the volume

4

Country of publishing house

CZ - CZECH REPUBLIC

Number of pages

8

Pages from-to

1-8

UT code for WoS article

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EID of the result in the Scopus database

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