Strategic Monetary-Fiscal Interactions in a Downturn
نویسندگان
چکیده
Very diverse responses of monetary and fiscal policies have been observed around the world in the post global financial crisis period of 2010-2014. Our paper explores (i) whether the strategic interaction between the central bank and government can explain this diversity, and (ii) what lessons about the institutional design of the two policies can be learnt from it. Particular attention is paid to the effect of explicit and/or strict inflation targeting and its possible effect on both monetary and fiscal outcomes.
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