A Requiem For The Fiscal Theory Of The Price Level
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A Requiem For The Fiscal Theory Of The Price Level
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Author : Mr.Roger Farmer
language : en
Publisher: International Monetary Fund
Release Date : 2019-10-11
A Requiem For The Fiscal Theory Of The Price Level written by Mr.Roger Farmer and has been published by International Monetary Fund this book supported file pdf, txt, epub, kindle and other format this book has been release on 2019-10-11 with Business & Economics categories.
The Fiscal Theory of the Price Level (FTPL) is the claim that, in a popular class of theoretical models, the price level is sometimes determined by fiscal policy rather than monetary policy. The models where this claim has been established assume that all decisions are made by an infinitely-lived representative agent. We present an alternative, arguably more realistic model, populated by sixty-two generations of people. We calibrate our model to an income profile from U.S. data and we show that the FTPL breaks down. In our model, the price level and the real interest rate are indeterminate, even when monetary and fiscal policy are both active. Our findings challenge established views about what constitutes a good combination of fiscal and monetary policies.
A Requiem For The Fiscal Theory Of The Price Level
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Author : Roger E.A. Farmer
language : en
Publisher:
Release Date : 2019
A Requiem For The Fiscal Theory Of The Price Level written by Roger E.A. Farmer and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2019 with categories.
We demonstrate that the Fiscal Theory of the Price Level (FTPL) cannot be used to determine the price level uniquely in the overlapping generations (OLG) model. We provide two examples of OLG models, one with three 3-period lives and one with 62-period lives. Both examples are calibrated to an income profile chosen to match the life-cycle earnings process in U.S. data estimated by Guvenen et al. (2015). In both examples, there exist multiple steady-state equilibria. Our findings challenge established views about what constitutes a good combination of fiscal and monetary policies. As long as the primary deficit or the primary surplus is not too large, the fiscal authority can conduct policies that are unresponsive to endogenous changes in the level of its outstanding debt. Monetary and fiscal policy can both be active at the same time.
The Fiscal Theory Of The Price Level
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Author : Fernando C. Ballabriga
language : en
Publisher:
Release Date : 2004
The Fiscal Theory Of The Price Level written by Fernando C. Ballabriga and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2004 with categories.
The Fallacy Of The Fiscal Theory Of The Price Level
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Author : Willem H. Buiter
language : en
Publisher:
Release Date : 2017
The Fallacy Of The Fiscal Theory Of The Price Level written by Willem H. Buiter and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2017 with Fiscal policy categories.
A Requiem For The Fiscal Theory Of The Price Level
DOWNLOAD
Author : Mr.Roger Farmer
language : en
Publisher: International Monetary Fund
Release Date : 2019-10-11
A Requiem For The Fiscal Theory Of The Price Level written by Mr.Roger Farmer and has been published by International Monetary Fund this book supported file pdf, txt, epub, kindle and other format this book has been release on 2019-10-11 with Business & Economics categories.
The Fiscal Theory of the Price Level (FTPL) is the claim that, in a popular class of theoretical models, the price level is sometimes determined by fiscal policy rather than monetary policy. The models where this claim has been established assume that all decisions are made by an infinitely-lived representative agent. We present an alternative, arguably more realistic model, populated by sixty-two generations of people. We calibrate our model to an income profile from U.S. data and we show that the FTPL breaks down. In our model, the price level and the real interest rate are indeterminate, even when monetary and fiscal policy are both active. Our findings challenge established views about what constitutes a good combination of fiscal and monetary policies.
The Fallacy Of The Fiscal Theory Of The Price Level
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Author : Willem H. Buiter
language : en
Publisher:
Release Date : 2000
The Fallacy Of The Fiscal Theory Of The Price Level written by Willem H. Buiter and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2000 with Fiscal policy categories.
The Price Level The Quantity Theory Of Money And The Fiscal Theory Of The Price Level
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Author : David B. Gordon
language : en
Publisher:
Release Date : 2002
The Price Level The Quantity Theory Of Money And The Fiscal Theory Of The Price Level written by David B. Gordon and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2002 with Monetary policy categories.
We consider price level determination from the perspective of portfolio choice. Arbitrages among money balances, bonds, and investment goods determine their relative demands. Returns to real balance holdings (transactions services), the nominal interest rate, and after-tax returns to investment goods determine the relative values of nominal and real assets. Since expectations of government policies ultimately determine the expected returns to both nominal and real assets, monetary and fiscal policies jointly determine the price level. Special cases of the fiscal and monetary policies considered produce the quantity theory of money and the fiscal theory of the price level
Cochrane S Defence Of The Fiscal Theory Of The Price Level
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Author : Colin Rogers
language : en
Publisher:
Release Date : 2006
Cochrane S Defence Of The Fiscal Theory Of The Price Level written by Colin Rogers and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2006 with Prices categories.
Cochrane (2005) employs a well specified Walrasian general equilibrium model to defend the fiscal theory of the price level against two forms of criticism; that: (1) it implies the violation of Walras's Law and, (2) the completely cashless, frictionless version of the model cannot determine the price level. Of the two criticisms only the second is substantive. This paper explains why no version of Cochrane's model offers a theory of the price level. The model can determine the consumption good value of an asset and a numeraire denominated price level. A numeraire denominated price level is of no theoretical significance.
Indeterminacy Bubbles And The Fiscal Theory Of Price Level Determination
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Author : Bennett T. McCallum
language : en
Publisher:
Release Date : 1998
Indeterminacy Bubbles And The Fiscal Theory Of Price Level Determination written by Bennett T. McCallum and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 1998 with Fiscal policy categories.
The recently-developed fiscal theory of price level determination contends that there is an important class of policy rules in which there exists a unique rational expectations solution that shows the price level to be dependent upon fiscal policy and independent of monetary variables. The present paper argues, however, that there is an alternative solution to these models that has entirely traditional (or monetarist') properties. This latter solution is perhaps the more plausible since it is the solution that is typically regarded as the bubble-free fundamentals' solution. The argument involves a respecification of feasible instrument variables
Overlapping Generations
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Author : Stephen E. Spear
language : en
Publisher: Emerald Group Publishing
Release Date : 2023-09-04
Overlapping Generations written by Stephen E. Spear and has been published by Emerald Group Publishing this book supported file pdf, txt, epub, kindle and other format this book has been release on 2023-09-04 with Business & Economics categories.
The 800 pound gorilla in the room of macroeconomics is the question of why the overlapping generations model didn’t become the central workhorse model for macroeconomics, as opposed to the neoclassical growth model. The authors here explore the co-evolution of the two models.