Money Quantity and Optimal Monetary and Fiscal Policy: A Quantitative Analysis

Xuan Liu ()
Additional contact information
Xuan Liu: Department of Economics, East Carolina University, Greenville, NC 27858, USA

Frontiers of Economics in China-Selected Publications from Chinese Universities, 2012, vol. 7, issue 2, 263-285

Abstract: This paper quantitatively analyzes the impact of money stock on optimal monetary and fiscal policy in a stochastic production economy with sticky prices. The numerical results indicate that a sufficient large quantity of money makes a noticeable difference in many aspects of optimal monetary and fiscal policy. They suggest that the volatile inflation in China may not be as bad as the existing theory would have implied if its large amount of money is taken into consideration.

Keywords: optimal fiscal and monetary policy; money stock; sticky prices (search for similar items in EconPapers)
JEL-codes: E31 E52 (search for similar items in EconPapers)
Date: 2012
References: Add references at CitEc
Citations:

Downloads: (external link)
http://journal.hep.com.cn/fec/EN/10.3868/s060-001-012-0012-3 (application/pdf)

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: https://EconPapers.repec.org/RePEc:fec:journl:v:7:y:2012:i:2:p:263-285

Access Statistics for this article

Frontiers of Economics in China-Selected Publications from Chinese Universities is currently edited by LONG Jie

More articles in Frontiers of Economics in China-Selected Publications from Chinese Universities from Higher Education Press
Bibliographic data for series maintained by Frank H. Liu ().