Optimal money and debt management: Liquidity provision vs tax smoothing

• 成果类型: Article
• 署名作者: Canzoneri, Matthew; Cumby, Robert; Diba, Behzad
• 署名单位: Georgetown University
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2016.08.004
• 发表日期: 2016
• 页码: 39-53
• 关键词: Optimal fiscal and monetary policy; Friedman rule; Tax smoothing

摘要

Conventional wisdom on public debt management says that liquidity demand should be satiated and that tax rates should be smoothed. Conflicts between the two can arise when government bonds provide liquidity. Smoothing taxes causes greater variability in fiscal balances, and therefore in the supply of government liabilities. When prices are flexible, and can jump to absorb fiscal shocks, the tradeoff between liquidity provision and tax smoothing is eased; when they conflict, optimal policy subordinates tax smoothing to satiating liquidity demand. When price fluctuations impose real costs, conflicts necessarily arise and optimal policy gives primacy to neither goal. (C) 2016 Elsevier B.V. All rights reserved.