Inflation's role in optimal monetary-fiscal policy

• 成果类型: Article
• 署名作者: Leeper, Eric M.; Zhou, Xuan
• 署名单位: University of Virginia; National Bureau of Economic Research; Renmin University of China
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2021.10.006
• 发表日期: 2021
• 页码: 1-18
• 关键词: inflation; Tax smoothing; debt management; Debt maturity; Fiscal finance

摘要

We address the optimal marginal source of financing shocks that raise fiscal needs in the presence of a maturity structure for nominal government debt, distortionary taxes, and sticky prices. We find: (1) the importance of innovations in current and expected inflation that revalue debt increases with both the average maturity and the level of debt; (2) an analytical trade off between inflation and output-gap stabilization as a function of debt maturity; (3) at current debt levels and maturity lengths in advanced economies, inflation would account for as much as 50 percent of marginal optimal financing; (4) maturity attenuates welfare losses from nominal rigidities. (c) 2021 Elsevier B.V. All rights reserved.