Printing away the mortgages: Fiscal inflation and the post-covid boom

• 成果类型: Article
• 署名作者: Diamond, William; Landvoigt, Tim; Sanchez, German Sanchez
• 署名单位: University of Pennsylvania; National Bureau of Economic Research; University of Pennsylvania
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2025.104072
• 发表日期: 2025
• 关键词: Fiscal/monetary policy; Covid-19; household finance; Mortgage markets; inflation

摘要

We analyze interactions between fiscal and monetary stimulus in a new Keynesian model with nominal mortgage debt that can be inflated away. Redistributive transfers are most impactful when followed by a temporary deviation from inflation-targeting monetary policy. Unlike other fiscal policies, redistribution causes inflation even in the absence of long-run debt sustainability problems, and inflating away mortgages results in additional redistribution. In a quantitative model with mortgage refinancing frictions, transfer payments provide much more stimulus than the redistributive effects of inflation. Borrowers gradually refinance after their mortgages are inflated away, dampening their immediate consumption response and reducing their long-run labor supply.