Research into monetary policy proves a winner

27 February 2017

Dr Leo Krippner's research is finding favour in the world's central banks.

Waikato Management School alumnus Dr Leo Krippner, a senior adviser at the Reserve Bank of New Zealand, has won an international award for his pioneering research into monetary policy.

The London-based Central Banking Publications Award for Economics is given annually to a person who makes the most significant contribution to economics within the field of central banking.

In the wake of the global financial crisis, Dr Krippner (PhD in Economics, 2008) has led the debate on how central bank economists should think about unconventional monetary policy, through his research into yield curves and term structure modelling.

"It was an idea I had when I was doing my PhD thesis at Waikato on term structure modelling, and I developed it after interest rates in many global economies became constrained near zero."

It's a fascinating area of economics to be involved in, he says, leading to a better understanding of how monetary policy can influence the global and New Zealand economies.

“This recognition is a welcome bonus, and humbling at the same time, given the list of past winners."

Dr Krippner's ideas aim to quantify the effects of monetary policy below the zero lower bound – and in so doing recognise that policy in the 'new normal' is driven not only by short rates but also by the shape of the entire yield curve – with expectations on how it will evolve.

Sandra Eickmeier, an economist at the Deutsche Bundesbank who has co-authored research with Dr Krippner, says his ideas are becoming widely adopted.

"Dr Krippner's measures are now in the toolbox of most central banks since the global financial crisis and serve to directly inform policymakers.”