Measuring the welfare costs of inflation in a life-cycle model

Autor:	Paul Gomme
Rok vydání:	2015
Předmět:	Inflation Economics and Econometrics Control and Optimization Monetarism Applied Mathematics media_common.quotation_subject Monetary policy Monetary economics Payment Microeconomics Economics Real interest rate Distortion (economics) Welfare Constraint (mathematics) media_common
Zdroj:	Journal of Economic Dynamics and Control. 57:132-144
ISSN:	0165-1889
DOI:	10.1016/j.jedc.2015.06.002
Popis:	In a neoclassical growth model with life-cycle households in which money is held to satisfy a cash-in-advance constraint, the optimal steady state inflation rate is absurdly high: in excess of 20%. Lump-sum, age-independent money injections twist and flatten the lifetime profile of utility, making this profile look more like the one that would be chosen by a planner. The cost of monetary finance of lump-sum payments is the distortion introduced to the labor-leisure choice.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::8810e9e487a72b1e5621188e5968d8e5 https://doi.org/10.1016/j.jedc.2015.06.002 Zobrazit plný text záznamu Full Text from ScienceDirect