Inflation dynamics: The role of public debt and policy regimes

• 成果类型: Article
• 署名作者: Bhattarai, Saroj; Lee, Jae Won; Park, Woong Yong
• 署名单位: Pennsylvania Commonwealth System of Higher Education (PCSHE); Pennsylvania State University; Pennsylvania State University - University Park; Seoul National University (SNU); University of Hong Kong
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2014.07.004
• 发表日期: 2014
• 页码: 93-108
• 关键词: Inflation target; Inflation response; public debt; Monetary and fiscal policy regimes; Monetary and fiscal policy stances

摘要

In a passive monetary and active fiscal policy regime, changes in the value of public debt generate wealth effects on households. Then, in contrast to the active monetary and passive fiscal policy regime, inflation moves oppositely from the inflation target and a stronger reaction of interest rates to inflation increases the response of inflation to shocks. Moreover, a higher level of public debt increases the response of inflation while a weaker reaction of taxes to debt decreases the response of inflation to shocks. In a passive monetary and passive fiscal policy regime, both monetary and fiscal policy parameters affect inflation. (C) 2014 Elsevier B.V. All rights reserved.