Optimal Fiscal and Monetary Policy in a Medium-Scale Macroeconomic Model

  title={Optimal Fiscal and Monetary Policy in a Medium-Scale Macroeconomic Model},
  author={Stephanie Schmitt - Groh{\'e} Mart́ın Uribe},
  • Stephanie Schmitt - Grohé Mart́ın Uribe
  • Published 2005
In this paper, we study Ramsey-optimal fiscal and monetary policy in a mediumscale model of the U.S. business cycle. The model features a rich array of real and nominal rigidities that have been identified in the recent empirical literature as salient in explaining observed aggregate fluctuations. The main result of the paper is that price stability appears to be a central goal of optimal monetary policy. The optimal rate of inflation under an income tax regime is half a percent per year with a… CONTINUE READING
Highly Cited
This paper has 101 citations. REVIEW CITATIONS


Publications citing this paper.
Showing 1-10 of 74 extracted citations

Optimal Monetary and Fiscal Policy for Small Open and Emerging Economies

Angelo Marsiglia Fasolo
View 20 Excerpts
Highly Influenced

Fiscal consolidation and its cross-country effects ∗

Apostolis Philippopoulos, Petros Varthalitis, Vanghelis Vassilatos
View 3 Excerpts
Highly Influenced

Credit and Banking in a DSGE Model of the Euro Area

Andrea Gerali, Stefano Neri, Luca Sessa, Federico M. Signoretti
View 1 Excerpt
Highly Influenced

Optimal Fiscal Rules When Unemployment Matters

Stéphane Moyen, Nikolai Stähler
View 3 Excerpts
Highly Influenced

The Intertemporal Keynesian Cross

Adrien Auclert, Matthew Rognlie, Ludwig Straub

101 Citations

Citations per Year
Semantic Scholar estimates that this publication has 101 citations based on the available data.

See our FAQ for additional information.


Publications referenced by this paper.
Showing 1-10 of 29 references

Policy Analysis in Business Cycle Models,

V. V. Chari, Lawrence J. Christiano, Patrick J. Kehoe
Frontiers of Business Cycle Research, • 1995
View 3 Excerpts
Highly Influenced

Fiscal and Monetary Policy in a Medium-Scale Macroeconomic Model: Expanded Version,

Schmitt-Grohé, Stephanie, Mart́ın Uribe, “Optimal
NBER Working Paper • 2005

Government Transfers and the Friedman Rule,

Schmitt-Grohé, Stephanie, Mart́ın Uribe

Monetary Policy Under Uncertainty in Micro-Founded Macroeconometric Models,” manuscript prepared for the NBER’s

Levin, T Andrew, Alexei Onatski, John C. Williams, Noah Williams
Twentieth Annual Conference on Macroeconomics, • 2005
View 1 Excerpt

A Search for a Structural Phillips Curve,

Cogley, Timothy, Argia M. Sbordone

Similar Papers

Loading similar papers…