| 来源类型 | Discussion paper
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| 规范类型 | 论文
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| 来源ID | DP115
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| DP115 Capital Accumulation, Inflation and Long-Run Conflict in International Objectives |
| Frederick van der Ploeg
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| 发表日期 | 1986-06-01
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| 出版年 | 1986
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| 语种 | 英语
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| 摘要 | It is shown that, when there is a genuine long-run trade-off between inflation and output, coordination under pre-commitment yields substantial improvements in economic welfare. The analysis is conducted within the context of a two-country model with capital accumulation, immobile labour, perfect capital mobility and floating exchange rates. If the home government increases its monetary growth rate, it increases home inflation, reduces the world real interest rate and therefore boosts both home and foreign capital accumulation. The foreign country thus enjoys a gain in output without suffering from higher inflation. Competitive policies lead to monetary policies which are too tight and levels of activity which are too low, since each country attempts to be a "free rider". Coordination leads to a lower world real interest rate and higher welfare. Pre-commitment is necessary, for the success of coordinated policies, however. Otherwise each government has an incentive to renege and levy a "surprise" inflation tax. In the absence of binding contracts or reputation effects, both cooperation and competitive policy formulation lead to excessive monetary growth rates and higher levels of activity than under coordination or competition with pre-commitment. Coordination can be futile, since it exacerbates the lack of credibility perceived by the private sectors. |
| 主题 | International Macroeconomics
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| 关键词 | Capital accumulation
Credibility
Interdependence
monetary policy
Policy coordination
Precommitment
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| URL | https://cepr.org/publications/dp115
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| 来源智库 | Centre for Economic Policy Research (United Kingdom)
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| 资源类型 | 智库出版物
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| 条目标识符 | http://119.78.100.153/handle/2XGU8XDN/529271
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推荐引用方式
GB/T 7714 |
Frederick van der Ploeg. DP115 Capital Accumulation, Inflation and Long-Run Conflict in International Objectives. 1986.
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