Stabilization vs. Redistribution: The optimal monetary-fiscal mix

• 成果类型: Article
• 署名作者: Bilbiie, Florin O.; Monacelli, Tommaso; Perotti, Roberto
• 署名单位: University of Cambridge; Center for Economic & Policy Research (CEPR); Bocconi University; Bocconi University; National Bureau of Economic Research
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2024.103623
• 发表日期: 2024
• 关键词: inequality; redistribution; aggregate demand; Fiscal transfers; Optimal monetary-fiscal policy; TANK

摘要

Stabilization and redistribution are intertwined in a model with heterogeneity, imperfect insurance, and nominal rigidity-making fiscal and monetary policy inextricably linked for aggregate-demand management. Movements in inequality induced by fiscal transfers make the flexible-price equilibrium suboptimal, thus triggering a stabilization vs redistribution tradeoff. Likewise, changes in government spending that are associated with changes in the distribution of taxes (progressive vs. regressive) induce a tradeoff for monetary policy: the central bank cannot stabilize real activity at its efficient level (including insurance) and simultaneously avoid inflation. Fiscal policy can be used in conjunction to monetary policy to strike the optimal balance between stabilization and insurance (redistribution) motives.