Designing fiscal and monetary institutions in a second-best world
This paper explores how fiscal and monetary policy interact if commitment and access to lump-sum taxation are limited. We analyze how equilibrium outcomes for inflation, employment, and public spending are affected by the structural features of an economy, such as money holdings, outstanding public debt, labor-market distortions, society s preferences, and the nature of the policy game. In a normative vein, we compare society s welfare across various institutional settings and investigate how society should optimally adjust the preferences of policymakers.
(This abstract was borrowed from another version of this item.)
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Persson, Torsten & Tabellini, Guido, 1993. "Designing institutions for monetary stability," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 39(1), pages 53-84, December.
- Tabellini, Guido, 1986. "Money, debt and deficits in a dynamic game," Journal of Economic Dynamics and Control, Elsevier, vol. 10(4), pages 427-442, December.
- Lohmann, Susanne, 1992. "Optimal Commitment in Monetary Policy: Credibility versus Flexibility," American Economic Review, American Economic Association, vol. 82(1), pages 273-86, March.
- Levine, Paul L & Pearlman, Joseph, 1992. "Fiscal and Monetary Policy Under EMU: Credible Inflation Targets or Unpleasant Monetary Arithmetic?," CEPR Discussion Papers 701, C.E.P.R. Discussion Papers.
- Walsh, Carl E, 1995. "Optimal Contracts for Central Bankers," American Economic Review, American Economic Association, vol. 85(1), pages 150-67, March.
- Jensen, Henrik, 1994. "Loss of monetary discretion in a simple dynamic policy game," Journal of Economic Dynamics and Control, Elsevier, vol. 18(3-4), pages 763-779.
- Guy Debelle & Stanley Fischer, 1994.
"How independent should a central bank be?,"
Working Papers in Applied Economic Theory
94-05, Federal Reserve Bank of San Francisco.
- Brociner, Andrew & Levine, Paul L, 1992.
"Fiscal Policy Coordination and EMU: A Dynamic Game Approach,"
CEPR Discussion Papers
639, C.E.P.R. Discussion Papers.
- Levine, Paul & Brociner, Andrew, 1994. "Fiscal policy coordination and EMU : A dynamic game approach," Journal of Economic Dynamics and Control, Elsevier, vol. 18(3-4), pages 699-729.
- Thomas Krichel & Paul Levine & Joseph Pearlman, 1996.
"Fiscal and monetary policy in a monetary union: Credible inflation targets or monetized debt?,"
Review of World Economics (Weltwirtschaftliches Archiv),
Springer, vol. 132(1), pages 28-54, March.
- Thomas Krichel & Paul Levine & Joseph Pearlman, 1994. "Fiscal and Monetary Policy in a Monetary Union: Credible Inflation Targets or Monetised Debt?," School of Economics Discussion Papers 9403, School of Economics, University of Surrey.
- Eijffinger, S.C.W. & Schaling, E., 1993. "Central bank independence : Theory and evidence (Revised version)," Discussion Paper 1993-25, Tilburg University, Center for Economic Research.
- Carl E Walsh, 1993.
"Optimal contracts for independent central bankers: private information, performance measures and reappointment,"
Federal Reserve Bank of San Francisco, issue Mar.
- Carl E. Walsh, 1993. "Optimal contracts for independent central bankers: private information, performance measures and reappointment," Working Papers in Applied Economic Theory 93-02, Federal Reserve Bank of San Francisco.
- Levine, Paul, 1993. "Fiscal Policy Co-ordination under EMU and the Choice of Monetary Instrument," The Manchester School of Economic & Social Studies, University of Manchester, vol. 61(0), pages 1-12, Suppl..
- Rogoff, Kenneth, 1985. "The Optimal Degree of Commitment to an Intermediate Monetary Target," The Quarterly Journal of Economics, MIT Press, vol. 100(4), pages 1169-89, November.
- Thomas J. Sargent & Neil Wallace, 1981. "Some unpleasant monetarist arithmetic," Quarterly Review, Federal Reserve Bank of Minneapolis, issue Fall.
- repec:dgr:kubcen:199325 is not listed on IDEAS
When requesting a correction, please mention this item's handle: RePEc:eee:poleco:v:13:y:1997:i:1:p:53-79. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If references are entirely missing, you can add them using this form.