Article ID Journal Published Year Pages File Type
5060115 Economics Letters 2012 6 Pages PDF
Abstract
► We study a fiscal policy in a New-Keynesian model with deep habits and optimal monetary policy. ► The fiscal multiplier is above 1 and private consumption is crowded in. ► Optimized Taylor-type or price-level rules yield results close to optimal policy. ► Private consumption is crowded out if the Taylor rule is suboptimal. ► Private consumption is crowded out also if the ability to commit is absent.
Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
Authors
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