Money Creation: Tax or Public Liquidity?

Pietro Reichlin

Journal of Money, Credit and Banking, 2018, vol. 50, issue 5, 1073-1094

Abstract: I revisit the example of non‐neutral anticipated monetary expansions used in Lucas (1995) Nobel Prize Lecture, within a broader definition of monetary policy tools, such as paying a nominal return on money or using open market operations, to show that money expansions increase output by reallocating consumption across heterogenous individuals and time periods. This result survives with noninterest‐bearing cash when the latter does not generate relevant distortions.

Date: 2018
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https://doi.org/10.1111/jmcb.12479

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Working Paper: Money Creation: Tax or Public Liquidity? (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:wly:jmoncb:v:50:y:2018:i:5:p:1073-1094

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