A fiscal theory of monetary policy with partially-repaid long-term debt
| Autor: | John H. Cochrane |
|---|---|
| Rok vydání: | 2022 |
| Předmět: |
Inflation
Economics and Econometrics media_common.quotation_subject 05 social sciences Monetary policy Sample (statistics) Monetary economics Deflation Fiscal policy Interest rate Debt 0502 economics and business Fiscal theory of the price level Economics 050207 economics 050205 econometrics media_common |
| Zdroj: | Review of Economic Dynamics. 45:1-21 |
| ISSN: | 1094-2025 |
| Popis: | I construct a simple model with sticky prices and interest rate targets, closed by fiscal theory of the price level with long-term debt and fiscal and monetary policy rules. Fiscal surpluses rise following deficits, to repay accumulated debt, but surpluses do not respond to all values of unexpected inflation and deflation. This specification avoids common puzzles and produces reasonable responses to fiscal and monetary policy shocks. It allows an easy translation of any new-Keynesian model, and it allows one to study a whole sample with active fiscal policy. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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