| 来源类型 | Working Paper
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| 规范类型 | 报告
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| DOI | 10.3386/w27521
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| 来源ID | Working Paper 27521
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| Fiscal and Monetary Stabilization Policy at the Zero Lower Bound: Consequences of Limited Foresight |
| Michael Woodford; Yinxi Xie
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| 发表日期 | 2020-07-13
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| 出版年 | 2020
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| 语种 | 英语
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| 摘要 | This paper reconsiders the degree to which macroeconomic stabilization is possible when the zero lower bound is a relevant constraint on the effectiveness of conventional monetary policy, under an assumption of bounded rationality. In particular, we reconsider the potential role of countercyclical fiscal transfers as a tool of stabilization policy. Because Ricardian Equivalence no longer holds when planning horizons are finite (even when relatively long), we find that fiscal transfers can be a powerful tool to reduce the contractionary impact of an increased financial wedge during a crisis, and can even make possible complete stabilization of both aggregate output and inflation under certain circumstances, despite the binding lower bound on interest rates. However, the power of such policies depends on the degree of monetary policy accommodation. We also show that a higher level of welfare is generally possible if both monetary and fiscal authorities commit themselves to history-dependent policies in the period after the financial disturbance that causes the lower bound to bind has dissipated. Hence forward guidance continues to play an important role in increasing the effectiveness of stabilization policy. |
| 主题 | Macroeconomics
; Monetary Policy
; Fiscal Policy
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| URL | https://www.nber.org/papers/w27521
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| 来源智库 | National Bureau of Economic Research (United States)
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| 引用统计 |
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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/585194
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推荐引用方式
GB/T 7714 |
Michael Woodford,Yinxi Xie. Fiscal and Monetary Stabilization Policy at the Zero Lower Bound: Consequences of Limited Foresight. 2020.
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文件名：
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w27521.pdf
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格式：
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Adobe PDF
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