Work detail

Negative Interest Rates - How Far Can They Go?

Author: Bc. Jan Ján
Year: 2016 - summer
Leaders: doc. Mgr. Tomáš Holub Ph.D.
Work type: Bachelors
Language: English
Pages: 47
Awards and prizes:
Abstract: Bachelor thesis is focused on one of the most topical themes in the field of a
monetary policy, the negative interest rates. Until recent times the effective lower bound
of interest rates imposed by central banks was thought to be the strict null but
macroeconomic conditions of certain European countries or Japan made policy makers
start to experiment with the unexplored tool of a monetary policy. They broke the zero
lower bound and employed the negative interest rates. Since it seems that the effective
lower bound would not be zero but it is situated in the negative territory probably – and
the thesis tries to find such a value. The discussion starts at the beginning of the twentieth
century with the well-known economist Silvio Gesell, then continues to present and gives
a view of the countries, which have already implemented negative interest rates in some
form. Additionally, the thesis is focused on the issue concerning an increase in risks
presented by the financial markets arising from this monetary policy. Last but not least,
it takes into account the problem of the substitution from electronic money to cash, how
this constraint can be overcome and on what level of negative interest rates this could
take place.
July 2020




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