EconPapers    
Economics at your fingertips  
 

Optimal Monetary Policy with Heterogeneous Agents: Is There a Case for Inflation?

Theodore Palivos

No 353, Computing in Economics and Finance 1999 from Society for Computational Economics

Abstract: This paper analyzes the role of monetary policy in an overlapping generations model with two assets, capital and money, and two types of agents who exhibit different degrees of altruism towards their descendants. It is shown that changes in the money growth rate have significant distributional effects. Furthermore, the optimal rate of monetary expansion is, in general, higher than the one implied by the Friedman rule and may, in fact, yield a small but positive rate of inflation. Finally, this optimal rate of monetary expansion takes higher values as the society's aversion towards inequality increases.

New Economics Papers: this item is included in nep-mon
Date: 1999-03-01
References: Add references at CitEc
Citations View citations in EconPapers (3) Track citations by RSS feed

Downloads: (external link)
http://www.bus.lsu.edu/economics/faculty/tpalivos/personal/research.html main text (text/html)
Our link check indicates that this URL is bad, the error code is: 404 Not Found

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:sce:scecf9:353

Access Statistics for this paper

More papers in Computing in Economics and Finance 1999 from Society for Computational Economics CEF99, Boston College, Department of Economics, Chestnut Hill MA 02467 USA. Contact information at EDIRC.
Series data maintained by Christopher F. Baum ().

 
Page updated 2017-08-02
Handle: RePEc:sce:scecf9:353