Understanding Inflation as a Joint Monetary-Fiscal Phenomenon /

Leeper, Eric M.

Understanding Inflation as a Joint Monetary-Fiscal Phenomenon / Eric M. Leeper, Campbell Leith. - Cambridge, Mass. National Bureau of Economic Research 2016. - 1 online resource: illustrations (black and white); - NBER working paper series no. w21867 . - Working Paper Series (National Bureau of Economic Research) no. w21867. .

January 2016.

We develop the theory of price-level determination in a range of models using both ad hoc policy rules and jointly optimal monetary and fiscal policies and discuss empirical issues that arise when trying to identify monetary-fiscal regime. The article concludes with directions in which theoretical and empirical developments may go. The article is prepared for the Handbook of Macroeconomics, volume 2 (John B. Taylor and Harald Uhlig, editors, Elsevier Press).




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