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Automatic Monetary Stabilizers – A Solution For A Better Monetary Policy And Economy Functioning

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  • AILINCĂ, Alina Georgeta

    (“Victor Slăvescu” Centre for Financial and Monetary Research, Romanian Academy)

Abstract

As we know, the opposite of the current that support a strong discretionary action of the state is the current that completely excludes the intervention of the state in the economy. In addition to these, there is the current which claims the use of more “light” tools in the management of macroeconomic policies and the economy in general. In order to compensate for the fluctuations in business cycles and even the emergence of some unexpected shocks or imbalances in the economy, in the macroeconomic policies framework, among other things, automatic stabilizers have been proposed to be used. The role and their’s operation it was widely discussed especially regarding the fiscal and social sphere as: progressive taxes, transfers, social benefits etc. Thus, this article aims to identify and explain the operation of monetary (and foreign exchange) automatic stabilizers, while trying to provide also for the Romanian monetary policy some benchmarks in order to act in this regard.

Suggested Citation

  • AILINCĂ, Alina Georgeta, 2015. "Automatic Monetary Stabilizers – A Solution For A Better Monetary Policy And Economy Functioning," Journal of Financial and Monetary Economics, Centre of Financial and Monetary Research "Victor Slavescu", vol. 2(1), pages 47-58.
    • Handle: RePEc:vls:rojfme:v:2:y:2015:i:1:p:47-58
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    References listed on IDEAS

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    More about this item

    Keywords

    automatic monetary stabilizers; business cycle; monetary policy; output fluctuation;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • F31 - International Economics - - International Finance - - - Foreign Exchange

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