This thesis aims at currency interventions executed by Czech and Suisse central bank and their following comparison. Currency interventions became lately monetary instrument that both central banks adopted. Effect of intervention on real economic situation in both countries will be content of this thesis. Because of the scale off the interventions, this issue is still current and it is still publicly debated. First part of this thesis introduces systems of exchange rate arrangements and describes the role of central bank. Second part of this thesis deals with currency interventions in Czech Republic and focuses on intervention impacts on real economics. Third part is devoted to Suisse currency intervention.

Hereby presented Master Thesis deals with an analysis of preparedness of the Russian monetary policy for adoption of inflation-targeting regime. We define the impact of different factors on the level of inflation and consequently their importance in the process of predicting inflation in the period from January 2006 to September 2012 in the Russian Federation. The selection of the factors is based on theory and on the examination of the Russian monetary policy environment, taking into account the credibility, transparency and accountability of the monetary institutions and the financial sector and real economy specifications. The analysis of interconnections among the factors is based on a vector autoregressive regression model VAR(4) as well as on Granger causality test and impulse-response analysis. Our results indicate that the major role in inflation formation among the chosen variables, the exchange rate prevailed in the observed period and the interest rate gained in importance to certain extent. Thus the Russian Central Bank has proceeded to prepare the monetary policy rule for the adoption of inflation-targeting regime. Nevertheless, building more sound monetary and financial institutions, successful implementation of flexible exchange rate and abandoning exchange rate targeting, as...

Deflation, today understood mainly as a decrease in price level, is in the eyes of the mainstream economists the threat and danger of the economic development. This view is based on the experience from the Economic Crisis between 1929 and 1933 and later development in Japan. Therefore, the price stability is nowadays comprehended as a non decline in price index; monetary policy actually states the sustainable increase as a goal. The Austrian School of Economics uses the original definition of the words inflation and deflation and defines them as the increase and decrease of money supply. Modern interpretation of these terms means for them a dangerous misunderstanding whose result is misapprehension of causal connections between individual phenomena. This leads not only to incorrect conclusions but, above all, to disruption of the economic system, price and production structure, and development of economic cycles caused by artificial increase in money supply, which brings profit to certain groups.

Author: Pavel Ryska Doctoral thesis: The Empirics of Deflation and Economic Growth Abstract This doctoral thesis deals with the relationship between deflation and economic growth. Existing empirical research has focused on the simple link between price growth and GDP growth or introduced narrower price measures as control variables. The goal of the present work is to account for shifts in both demand and supply, so that the effect of price inflation on growth as such could be separated from effects of changes in certain elements of nominal demand and supply. The work takes two general approaches. First, I use a large macroeconomic panel data set of 20 countries over approximately 140 years to explore long-run and short-run effects of inflation on output growth, after controlling for money supply growth as a demand shifter and oil price growth as a proxy for shifts in supply. In doing so, I use a range of methods such as the vector error-correction model, autoregressive distributed lag model and the fixed effects panel model. Second, I propose a new approach that uses disaggregated sector data from national accounts on output, prices and other variables to explore the link between quantity produced and sector inflation rates. The advantage of the data set is that it is rich in modern-day observations of...

This dissertation presents the results of research focused on the Austrian business cycle theory (ABCT). The main part of the thesis is an econometrical test of five predictions based on ABCT. I used data on the US economy for period 1967 - 2016, which is the longest time period covered in the Austrian empirical literature so far. Since one of the most important variables for ABCT is so called interest rate gap (the difference between market interest rate and natural interest rate), I use three alternative models of this variable. The results of my empirical tests predominantly confirm theoretical predictions of ABCT. It can be shown that the interest rate gap influenced the relative structure of economic activity and resource allocation in a way predicted by ABCT. I also investigate whether the interest rate gap does have a significant impact on stock market valuations (in terms of aggregate level or relative structure), although the results are mostly statistically insignificant. In addition I also described several possible new distortions which may emerge due to unconventional monetary policy. I argue that these distortions should be of primary interest for researchers engaged in the Austrian research program. I devoted special attention to the specifics of monetary policy regime in Japan, where the Bank of Japan regularly intervenes on the stock market. Another theoretical contribution can be found in the second chapter where I respond to the White's (1999) claim that Hayek implicitly repudiated his own version of ABCT in later part of his career, when proposing free competition in money production. I attempt to show that White's conclusion stems from an inadequate interpretation of Hayek's writings. Finally I provide an alternative interpretation of Hayek's work that reveals the compatibility of his early and late theoretical contributions.

The main purpose of this thesis is to analyse the impacts of unconventional monetary policy instruments on small open economies in zero lower-bound situations. Although all unconventional instruments are discussed, an emphasis is placed on currency intervention. Impacts of the various instruments are demonstrated using the economies of Czech Republic and Switzerland as case studies. The thesis will conclude with a comparison of the case studies.

The diploma thesis deals with the analysis of the most significant phases of the monetary policy of the Czech National Bank, including the analysis and evaluation of its effectiveness from its origin to the present. The thesis is divided into three individual parts. Each part corresponds to a specific transmission mechanism applied by the Czech National Bank while implementing the monetary policy. Each chapter includes the assessment of the effectiveness of individual approaches and the analysis of the impact of the monetary policy as well as the decision of the Czech National Bank on the Czech economy. The very first chapter is focused on the application of the monetary transmission mechanism in conditions of the fixed exchange rate during which an increasing internal as well as external disequilibrium led to the monetary crisis. The second chapter is dedicated to the transition to the inflation targeting, expert discussion concerning its implementation and the evaluation of the achieved results. The last chapter presents the use of the CNB's additional instrument of the monetary policy in the form of the exchange rate including the reasons that led to this step. The closing part of this chapter focuses on the evaluation of the effectiveness of this policy.

The introduction of negative interest rates, as an additional tool of unconventional monetary policy in recent years, leads to many, yet largely polarized debates about the implications of the unconventional monetary policy of central banks. The main reason for their introduction in some economies, namely the threat of deflation, is also questioned, as well as the negative side effects of this instrument on financial stability and economic growth, and finally, their limited scope is under scrutiny. Due to the still insufficient research in this field, the aim of the diploma thesis is to evaluate the concerns and the main long-term risks and impacts of the monetary policy using negative interest rates in the context of deflation threats. The analysis of available data confirms both the concerns about the negative effects of negative interest rates on the banking sector, the recovery process of public finances, the possible rise of a price bubble on the financial markets and real estate markets, or on the possibility of excessive risk taking, and on the other hand draws attention to the direct dependence between negative impacts and the duration of monetary policy using negative interest rates.

The thesis is focused on the changes in the terms of trade in Czech international trade in the term of from 2005 to 2015, as the period after the Czech Republic joined the European Union. The terms of trade are an important indicator of the benefits and loses of international trade. The main aim is to analyze the changes of terms of trade, the causes of their changes, and the impact on the real economy. The direction of the overall terms of trade index was highly unsettled, and did not actually generated additional gains in the economy not over the reporting period. The overall terms of trades were most influenced by the price development of two groups of the Standard International Trade Classification, Crude materials and lubricants, and machinery and transport equipment. The prices of Crude materials and lubricants are determined mainly by changes in the oil prices. These were very volatile in the reporting period, the especially the collapse of the prices in both 2009 and 2014-2015, had a significant impact on the import prices of the Czech economy. The thesis also analyzes the impact of exchange rate on the international trade prices, in the period since November 2013, i.e. after the Czech National Bank has committed to maintain the rate of Czech koruna against the Euro above the level of 27 CZK/EUR, which helped to protect the economy from deflations and enhance the economic growth. The effect of the weak crown, that favored the Czech exporters, however a faded over time.

This diploma thesis focuses on the use of inflation targeting as monetary policy regime in a situation of imminent deflation. The thesis is divided into three main parts. The first part introduces the basic mechanism of inflation targeting with its basic elements and describes its possible failure. The second part focuses mainly on the analysis of the economic factors which contributed to achieving the zero lower bound for the repo rate of CNB. The third part presents an alternative (unconventional) monetary policy instruments in case of achieving zero lower bound, in particular the use of the exchange rate. The end of the last part of this thesis analyzes the development of key macroeconomic indicators in the Czech Republic.