期刊名称：Departmental Discussion Papers / University of Glasgow, Department of Economics
出版年度：2009
卷号：1
出版社：University of Glasgow, Department of Economics
摘要：We consider optimal monetary and scal policies in a New Keynesian model of a small open
economy with sticky prices and wages. In this benchmark setting monetary policy is all we need
- analytical results demonstrate that variations in government spending should play no role in
the stabilization of shocks. In extensions we show, rstly, that this is even when true when
allowing for ination inertia through backward-looking rule-of-thumb price and wage-setting, as
long as there is no discrepancy between the private and social evaluation of the marginal rate of
substitution between consumption and leisure. Secondly, the optimal neutrality of government
spending is robust to the issuance of public debt. In the presence of debt government spending
will deviate from the optimal steady-state but only to the extent required to cover the de cit, not
to provide any additional macroeconomic stabilization. However, unlike government spending
variations in tax rates can play a complementary role to monetary policy, as they change relative
prices rather than demand.
