| 来源类型 | Discussion paper
|
| 规范类型 | 论文
|
| 来源ID | DP5043
|
| DP5043 In Praise of Fiscal Restraint and Debt Rules. What the Euro Zone Might Do Now |
| Andrew Hughes Hallett
|
| 发表日期 | 2005-05-23
|
| 出版年 | 2005
|
| 语种 | 英语
|
| 摘要 | This paper attempts to reconcile the need for flexibility in fiscal policy, with the need for credibility and consistency in monetary policies. The idea is to generate fewer conflicts between policies but greater discipline within them. We assume an independent central bank and restraints on the use of national fiscal policies. Using a theoretical model, we examine the consequences of assigning leadership to fiscal or monetary policies to exploit the implicit (rule based) coordination available under standard transmission mechanisms, but where priorities and targets differ between policy makers. This works best with fiscal leadership: we introduce a debt rule (with hard or soft targets) to precommit fiscal policies over the longer term, but use monetary independence to guarantee credibility and discipline in the short run stabilization policies. Compared to the uncoordinated solution now operating in Europe, inflation biases are lower and debt repayments higher for no loss in output volatility. That corresponds to the experience of the UK, our benchmark case, whose empirical reaction functions show fiscal leadership. Across ten OECD countries, these gains are estimated to be worth 2%-4% of GDP. |
| 主题 | International Macroeconomics
|
| 关键词 | Stackelberg leadership
Institutional coordination
Debt rule
Soft targets
|
| URL | https://cepr.org/publications/dp5043
|
| 来源智库 | Centre for Economic Policy Research (United Kingdom)
|
| 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/533940
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推荐引用方式
GB/T 7714 |
Andrew Hughes Hallett. DP5043 In Praise of Fiscal Restraint and Debt Rules. What the Euro Zone Might Do Now. 2005.
|
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