Monetary and Fiscal Interaction with Various Degrees of Commitment

Kód výsledku v IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F49777513%3A23520%2F14%3A43921919" target="_blank" >RIV/49777513:23520/14:43921919 - isvavai.cz</a>

Výsledek na webu

<a href="http://web.b.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=bad01d57-95e8-49ed-9603-ea8185b0fa6f%40sessionmgr115&vid=2&hid=125" target="_blank" >http://web.b.ebscohost.com/ehost/pdfviewer/pdfviewer?sid=bad01d57-95e8-49ed-9603-ea8185b0fa6f%40sessionmgr115&vid=2&hid=125</a>

DOI - Digital Object Identifier

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Jazyk výsledku

angličtina

Název v původním jazyce

Monetary and Fiscal Interaction with Various Degrees of Commitment

Popis výsledku v původním jazyce

Well before the global financial crisis, the long-term trend in fiscal policy had raised concerns about risks for the outcomes of monetary policy. Are fears of an unpleasant monetarist arithmetic justified? To provide some insights, this paper examines strategic fiscal-monetary interactions in a novel game-theory framework with asynchronous timing of moves. It generalizes the standard commitment concept of Stackelberg leadership by making it dynamic. By letting players move with a certain fixed frequency, this framework allows policies to be committed or rigid for different periods of time. We find that the inferior non-Ricardian (active fiscal, passive monetary) regime can occur in equilibrium, and that this is more likely in a monetary union due to free-riding. The bad news is that, unlike under the static commitment of Sargent and Wallace (1981), this may happen even if monetary policy acts as leader for longer periods of time than fiscal policy. The good news is that under some cir

Název v anglickém jazyce

Monetary and Fiscal Interaction with Various Degrees of Commitment

Popis výsledku anglicky

Well before the global financial crisis, the long-term trend in fiscal policy had raised concerns about risks for the outcomes of monetary policy. Are fears of an unpleasant monetarist arithmetic justified? To provide some insights, this paper examines strategic fiscal-monetary interactions in a novel game-theory framework with asynchronous timing of moves. It generalizes the standard commitment concept of Stackelberg leadership by making it dynamic. By letting players move with a certain fixed frequency, this framework allows policies to be committed or rigid for different periods of time. We find that the inferior non-Ricardian (active fiscal, passive monetary) regime can occur in equilibrium, and that this is more likely in a monetary union due to free-riding. The bad news is that, unlike under the static commitment of Sargent and Wallace (1981), this may happen even if monetary policy acts as leader for longer periods of time than fiscal policy. The good news is that under some cir

Druh

J_x - Nezařazeno - Článek v odborném periodiku (Jimp, Jsc a Jost)

CEP obor

AH - Ekonomie

OECD FORD obor

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Projekt

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Návaznosti

I - Institucionalni podpora na dlouhodoby koncepcni rozvoj vyzkumne organizace

Rok uplatnění

2014

Kód důvěrnosti údajů

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Název periodika

FINANCE A UVER-CZECH JOURNAL OF ECONOMICS AND FINANCE

ISSN

0015-1920

e-ISSN

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Svazek periodika

64

Číslo periodika v rámci svazku

1

Stát vydavatele periodika

CZ - Česká republika

Počet stran výsledku

28

Strana od-do

2-29

Kód UT WoS článku

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EID výsledku v databázi Scopus

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