A Viable Gold Standard Requires Flexible Monetary And Fiscal Policy
This paper studies an idealized gold standard in a two-country setting. Without flexible national domestic credit expansion policies, the standard collapses in finite time through a speculative attack against one of the currencies. When a responsive domestic credit expansion policy eliminates the danger of a run on a country's reserves, the shocks disturbing the system, which previously were reflected in reserve flows, now show up in the public debt. Unless the primary government deficit is permitted to respond, the debt is likely to rise (or fall) to unsustainable levels. Viability can be achieved only through the active use of monetary and fiscal policy. Copyright 1989 by The Review of Economic Studies Limited.
(This abstract was borrowed from another version of this item.)
To our knowledge, this item is not available for
download. To find whether it is available, there are three
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
|Date of creation:||1988|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +44 (020) 7405 7686
Web page: http://www.lse.ac.uk/
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:fth:lseple:306. 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: (Thomas Krichel)
If references are entirely missing, you can add them using this form.