The Tax-Foundation Theory of Fiat Money
... numerous fiat moneys have failed when their issuing regime was expected to disappear in a revolution or a war. Unlike convertibility, where the issuer commits to provide gold for paper money, in the tax-foundation mechanism the government does not give anything useful for paper money. However, it do ...
... numerous fiat moneys have failed when their issuing regime was expected to disappear in a revolution or a war. Unlike convertibility, where the issuer commits to provide gold for paper money, in the tax-foundation mechanism the government does not give anything useful for paper money. However, it do ...
Monetary Policy and Debt Fragility ∗ Antoine Camous , Russell Cooper
... rates. Can the monetary authority act to eliminate strategic uncertainty over the value of sovereign debt? If so, will it have an incentive to do so? The answers to these questions are relevant for assessing the relevance of these results on strategic uncertainty in debt markets and for guidance on ...
... rates. Can the monetary authority act to eliminate strategic uncertainty over the value of sovereign debt? If so, will it have an incentive to do so? The answers to these questions are relevant for assessing the relevance of these results on strategic uncertainty in debt markets and for guidance on ...
NBER WORKING PAPER SERIES
... may constrain future policy options, if current policies imply debt obligations or future expenditure commitments. Similarly, expected future policies feedback to influence the set of current policies that can be chosen. To answer policy questions, one must consider current and future policies joint ...
... may constrain future policy options, if current policies imply debt obligations or future expenditure commitments. Similarly, expected future policies feedback to influence the set of current policies that can be chosen. To answer policy questions, one must consider current and future policies joint ...
Inflation forecast targeting and Taylor rules
... variables than inflation and the output gap, it will not be optimal … For a smaller and more open economy [than the US], the real exchange rate, the terms of trade, foreign output, and the foreign interest rate seem to be the minimal essential state variables that have to be added” [for the rule to ...
... variables than inflation and the output gap, it will not be optimal … For a smaller and more open economy [than the US], the real exchange rate, the terms of trade, foreign output, and the foreign interest rate seem to be the minimal essential state variables that have to be added” [for the rule to ...
View/Open
... price stability, given that fiscal dominance would then be precluded. There were also calls for the formation of independent national fiscal policy councils for the setting of annual deficit limits. In fact, greater fiscal discipline would have otherwise been observed amongst these countries had t ...
... price stability, given that fiscal dominance would then be precluded. There were also calls for the formation of independent national fiscal policy councils for the setting of annual deficit limits. In fact, greater fiscal discipline would have otherwise been observed amongst these countries had t ...
NBER WORKING PAPER SERIES COORDINATION OF MONETARY AND Warwick J. Mckibbin
... [1985b]. One crucial argument has been that the equilibrium of noncooperative macroeconomic policymaking under flexible exchange rates is likely to be inefficient, as countries fail to take into account the external effects of their policies on their trading partners. More rigid rules of the game, a ...
... [1985b]. One crucial argument has been that the equilibrium of noncooperative macroeconomic policymaking under flexible exchange rates is likely to be inefficient, as countries fail to take into account the external effects of their policies on their trading partners. More rigid rules of the game, a ...
Working Paper No. 819
... monetary base (liabilities issued by the central bank) as a ratio to GDP.11 According to equation (2), which is a simple mathematical formula but with complex interrelations between its variables, sovereign debt can be reduced in the following typical ways (or combinations between them): (i) signifi ...
... monetary base (liabilities issued by the central bank) as a ratio to GDP.11 According to equation (2), which is a simple mathematical formula but with complex interrelations between its variables, sovereign debt can be reduced in the following typical ways (or combinations between them): (i) signifi ...
SPEECH 29/11/2011 Deputy Governor Lars E.O. Svensson
... currency depreciation. The authority responsible for monetary policy is typically the central bank. In many countries, including all the member states of the EU, the central bank is given exclusive authority over monetary policy by statute and various measures to protect this policy independence are ...
... currency depreciation. The authority responsible for monetary policy is typically the central bank. In many countries, including all the member states of the EU, the central bank is given exclusive authority over monetary policy by statute and various measures to protect this policy independence are ...
This PDF is a selection from an out-of-print volume from... Bureau of Economic Research
... of interest rates. The simpler model is nevertheless useful in focusing on the partial effect of nominal interest deductibility and taxation. Despite its simple structure, or perhaps because of it, the current model also provides insights into the welfare effects of inflation. The economists' tradit ...
... of interest rates. The simpler model is nevertheless useful in focusing on the partial effect of nominal interest deductibility and taxation. Despite its simple structure, or perhaps because of it, the current model also provides insights into the welfare effects of inflation. The economists' tradit ...
PDF
... objective. Therefore, in order to favouring the consumption of cleaner goods, it should be important not only charging those pollutant intensive goods, but also charging those with relatively high demand elasticity. Relevant literature analyse the environmental tax distributive impacts and the effe ...
... objective. Therefore, in order to favouring the consumption of cleaner goods, it should be important not only charging those pollutant intensive goods, but also charging those with relatively high demand elasticity. Relevant literature analyse the environmental tax distributive impacts and the effe ...
What Ended the Great Depression?
... from the decomposition itself. 12 The recessions of 1921 and 1938 are arguably two such crucial episodes. In both cases there were large movements in real output that have been almost universally ascribed to monetary and fiscal policy decisions. Friedman and Schwartz, for example, stated that "in bo ...
... from the decomposition itself. 12 The recessions of 1921 and 1938 are arguably two such crucial episodes. In both cases there were large movements in real output that have been almost universally ascribed to monetary and fiscal policy decisions. Friedman and Schwartz, for example, stated that "in bo ...
What Ended the Great Depression? - University of California, Berkeley
... from the decomposition itself. 12 The recessions of 1921 and 1938 are arguably two such crucial episodes. In both cases there were large movements in real output that have been almost universally ascribed to monetary and fiscal policy decisions. Friedman and Schwartz, for example, stated that "in bo ...
... from the decomposition itself. 12 The recessions of 1921 and 1938 are arguably two such crucial episodes. In both cases there were large movements in real output that have been almost universally ascribed to monetary and fiscal policy decisions. Friedman and Schwartz, for example, stated that "in bo ...
- Alfred Lerner College of Business and Economics
... fact, the government should present official data on Agovernment debt held by the public excluding the central bank.@ Third, will transfers plus open-market purchases to remedy a recession be inflationary? It is true that permanent continuous transfers plus open-market purchases would eventually be ...
... fact, the government should present official data on Agovernment debt held by the public excluding the central bank.@ Third, will transfers plus open-market purchases to remedy a recession be inflationary? It is true that permanent continuous transfers plus open-market purchases would eventually be ...
This PDF is a selection from an out-of-print volume from... of Economic Research Volume Title: International Aspects of Fiscal Policies
... Within each of these exchange rate systems, we analyze the behavior and characteristics of fiscal policy and examine the way changes in the rules of the game affect the incentives to use fiscal and monetary policies. In particular, we seek to determine whether the various inefficiencies of floating ...
... Within each of these exchange rate systems, we analyze the behavior and characteristics of fiscal policy and examine the way changes in the rules of the game affect the incentives to use fiscal and monetary policies. In particular, we seek to determine whether the various inefficiencies of floating ...
The Tax Smoothing Implications of the Federal Debt Paydown
... response to surprise increases in currentor future government spending, or it delivers capital gains to existing creditors in response to surprise decreases in current or future government spending. Second, it pays down the debt when government spending is low and is anticipated to rise, or converse ...
... response to surprise increases in currentor future government spending, or it delivers capital gains to existing creditors in response to surprise decreases in current or future government spending. Second, it pays down the debt when government spending is low and is anticipated to rise, or converse ...
World War II Fiscal Policies and the End of the Great Depression
... approximatedthe naturalrate of unemployment.The 1942 unemployment rate was 4.7 percent for the civilian laborforce and 4.4 percent for the labor force with the armed forces included. More troublingare argumentsby Higgs and Simon Kuznets that the Departmentof Commercereal GNP figuresfor the war years ...
... approximatedthe naturalrate of unemployment.The 1942 unemployment rate was 4.7 percent for the civilian laborforce and 4.4 percent for the labor force with the armed forces included. More troublingare argumentsby Higgs and Simon Kuznets that the Departmentof Commercereal GNP figuresfor the war years ...
Do You Mind if I Round?: Eliminating the Penny A Structural Analysis∗
... literature cited in this paper. Our currency depreciation parameter σ is calibrated to 0.40 for two reasons. First, it’s large enough to ensure that the government will have to produce new currency in the second period. Second, one-dollar bills in the United States last an average of about 18 months ...
... literature cited in this paper. Our currency depreciation parameter σ is calibrated to 0.40 for two reasons. First, it’s large enough to ensure that the government will have to produce new currency in the second period. Second, one-dollar bills in the United States last an average of about 18 months ...
Fiscal Consolidations Under Imperfect Credibility
... point, we move on to the benchmark case in which the consolidating economy is a small member of a currency union (CU henceforth), without the means to exert any meaningful in‡uence on currency union policy rates and its nominal exchange rate. The latter case, we believe, is the most interesting one ...
... point, we move on to the benchmark case in which the consolidating economy is a small member of a currency union (CU henceforth), without the means to exert any meaningful in‡uence on currency union policy rates and its nominal exchange rate. The latter case, we believe, is the most interesting one ...
4 Nigeria
... some countries lent their support to Biafra and others to Nigeria. Since independence Nigerian has witnessed various forms of governments from civil democratic to military rule. The Military has dominated the scene of governance for more than two decades since 1960. The performance of the military h ...
... some countries lent their support to Biafra and others to Nigeria. Since independence Nigerian has witnessed various forms of governments from civil democratic to military rule. The Military has dominated the scene of governance for more than two decades since 1960. The performance of the military h ...
Optimal Fiscal Policy in a Monetary Union ∗ Jordi Gal´ı
... accumulation. Our model also ignores many aspects that are likely to be relevant for the design of optimal policies. Missing elements include, among others, the presence of sticky wages (along with sticky prices), the need to rely on distortionary taxes, the effects of government debt policies, and t ...
... accumulation. Our model also ignores many aspects that are likely to be relevant for the design of optimal policies. Missing elements include, among others, the presence of sticky wages (along with sticky prices), the need to rely on distortionary taxes, the effects of government debt policies, and t ...
7. M T P
... 2010 and continued to implement the policy mix of low policy rate, wide interest rate corridor and high reserve requirement ratios in the first quarter of 2011. Accordingly, 1-week repo rate, the policy rate, was reduced to 6.25 percent in January with a 25 basis point decline and the weighted avera ...
... 2010 and continued to implement the policy mix of low policy rate, wide interest rate corridor and high reserve requirement ratios in the first quarter of 2011. Accordingly, 1-week repo rate, the policy rate, was reduced to 6.25 percent in January with a 25 basis point decline and the weighted avera ...
Do High Interest Rates Defend Currencies During Speculative
... regimes have suffered significantly from speculative attacks against their currencies. To prevent such attacks from developing into currency crises, academics and policymakers around the world have been investigating the appropriate policy responses. In this context, an important question is whether a ...
... regimes have suffered significantly from speculative attacks against their currencies. To prevent such attacks from developing into currency crises, academics and policymakers around the world have been investigating the appropriate policy responses. In this context, an important question is whether a ...
Debt Stabilization and Macroeconomic Volatility in Monetary Unions
... risk premia of government debt of euro area countries not only after the 2007-08 financial crisis and the outbreak of the still ongoing euro area crisis, but in the period before these events. As pointed out by Arghyrou and Kontonikas (2011), “This regime-shift not only explains the sudden escalatio ...
... risk premia of government debt of euro area countries not only after the 2007-08 financial crisis and the outbreak of the still ongoing euro area crisis, but in the period before these events. As pointed out by Arghyrou and Kontonikas (2011), “This regime-shift not only explains the sudden escalatio ...
Household debt, monetary policy and financial stability
... probability that a bubble will collapse. In expectation terms, higher interest rates lower the expected duration of bubbles, and hence lower the expected size of them. ...
... probability that a bubble will collapse. In expectation terms, higher interest rates lower the expected duration of bubbles, and hence lower the expected size of them. ...
Euro Plus Pact
The Euro-Plus Pact (or Euro+ Pact, also initially called the Competitiveness Pact or later the Pact for the Euro), was adopted in March 2011 under EU's Open Method of Coordination, as an intergovernmental agreement between all member states of the European Union (except Croatia, Czech Republic, Hungary, Sweden and UK), in which concrete commitments were made to be working continuously within a new commonly agreed political general framework for the implementation of structural reforms intended to improve competitiveness, employment, financial stability and the fiscal strength of each country. The plan was advocated by the French and German governments as one of many needed political responses to strengthen the EMU in areas which the European sovereign-debt crisis had revealed as being too poorly constructed.The pact was constructed as an attempt to incentivize increased implementation of structural reforms by each participating EU member state, to improve their performance within the four focus areas of the pact, through: (1) A regular bottom-up inter-governmental political dialogue (learning best practices from each other) and (2) A commitment for each state to include reform measures (freely chosen from a broad list of potential policy action responses) in their annual National Reform Programme for those of the areas found in critical need of improvement. In addition, it also featured a commitment to transpose and operationalize one of the Stability and Growth Pact fiscal rules directly into national legislation - to make it more effectively working, and a commitment to perform regular ""structured dialogue"" for enhanced tax policy coordination in EU.In May 2015, the European Political Strategy Centre (in-house think tank of the European Commission) upon its analysis of the latest set of submitted National Reform Programmes, declared the pact was in a dormant state (not being actively used or referred to by the majority of participating states), and recommended it should be revived by moving it from its current intergovernmental state to become an integrated part of the European Semester in the EU framework law. In the latest approved plan for reforming the EMU, this recommendation was adopted with a target for its transposition to take place at the latest in June 2017.