Galí, J. (2014) “The Effects of a Money-Financed Fiscal Stimulus“, Centre for Economic Policy Research, 24 Σεπτεμβρίου.
I analyze the effects of an increase in government purchases financed entirely through seignorage, in both a classical and a New Keynesian framework, and compare them with those resulting from a more conventional debt-financed stimulus. My findings point to the importance of nominal rigidities in shaping those effects. Under a realistic calibration of such rigidities, a money-financed fiscal stimulus is shown to have very strong effects on economic activity, with relatively mild inflationary consequences. If the steady state is sufficiently inefficient, an increase in government purchases may increase welfare even if such spending is wasteful.
- Ritholz, B. (2014) “How Europe’s Stimulus Sausage Is Made: Ritholtz Chart“, Bloomberg View, 09 Σεπτεμβρίου.
- Janssen, R. (2014) “Quantitative Easing Or Business Easing In Europe?“, Social Europe Journal, 08 Σεπτεμβρίου.
- Veugelers, R. (2014) “Is Europe saving away its future? European public funding for research in the era of fiscal consolidation“, VoxEU Organisation, 28 Αυγούστου.