EconPapers    
Economics at your fingertips  
 

The Price Level, the Quantity Theory of Money, and the Fiscal Theory of the Price Level

David Gordon () and Eric Leeper ()

No 9084, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We consider price level determination from the perspective of portfolio choice. Arbitrages among money balances, bonds, and investment goods determine their relative demands. Returns to real balance holdings (transactions services), the nominal interest rate, and after-tax returns to investment goods determine the relative values of nominal and real assets. Since expectations of government policies ultimately determine the expected returns to both nominal and real assets, monetary and fiscal policies jointly determine the price level. Special cases of the fiscal and monetary policies considered produce the quantity theory of money and the fiscal theory of the price level.

JEL-codes: E31 E41 (search for similar items in EconPapers)
Date: 2002-07
New Economics Papers: this item is included in nep-cba, nep-mac and nep-mon
Note: EFG
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10) Track citations by RSS feed

Published as Gordon, David B. and Eric M. Leeper. "The Price Level, The Quantity Theory Of Money, And The Fiscal Theory Of The Price Level," Scottish Journal of Political Economy, 2006, v53(1,Feb), 4-27.

Downloads: (external link)
http://www.nber.org/papers/w9084.pdf (application/pdf)

Related works:
Journal Article: THE PRICE LEVEL, THE QUANTITY THEORY OF MONEY, AND THE FISCAL THEORY OF THE PRICE LEVEL (2006) Downloads
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:nbr:nberwo:9084

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w9084

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().

 
Page updated 2020-07-07
Handle: RePEc:nbr:nberwo:9084