Optimal fiscal and monetary policy action in a closed economy

Philippopoulos, A., Varthalitis, P. and Vassilatos, V. (2015) Optimal fiscal and monetary policy action in a closed economy. Economic Modelling, 48, pp. 175-188. (doi:10.1016/j.econmod.2014.10.045)

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Abstract

We study optimized monetary and fiscal feedback policy rules. The setup is a New Keynesian DSGE model of a closed economy which is solved numerically using common parameter values and fiscal data from the Euro area. Our aim is to welfare rank alternative tax-spending policy instruments used for shock stabilization and debt consolidation when, at the same time, the monetary authorities can follow a Taylor rule for the nominal interest rate.

Item Type:Articles
Status:Published
Refereed:Yes
Glasgow Author(s) Enlighten ID:Varthalitis, Dr Petros and Philippopoulos, Prof Apostolis
Authors: Philippopoulos, A., Varthalitis, P., and Vassilatos, V.
College/School:College of Social Sciences > Adam Smith Business School > Economics
Journal Name:Economic Modelling
Publisher:Elsevier B.V.
ISSN:0264-9993
ISSN (Online):1873-6122
Copyright Holders:Copyright © 2014 Elsevier B.V.
First Published:First published in Economic modelling 48:175-188
Publisher Policy:Reproduced in accordance with the copyright policy of the publisher

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