05838oam 22012614 450 991096180460332120250426110718.097866128435189781462334582146233458X978145275713114527571359781451872842145187284497812828435161282843516(CKB)3170000000055295(EBL)1608352(SSID)ssj0000942997(PQKBManifestationID)11592953(PQKBTitleCode)TC0000942997(PQKBWorkID)10974673(PQKB)10444701(OCoLC)586080117(MiAaPQ)EBC1608352(IMF)WPIEE2009137(IMF)WPIEA2009137WPIEA2009137(EXLCZ)99317000000005529520020129d2009 uf 0engurcn|||||||||txtccrOptimal Monetary and Fiscal Policy with Limited Asset Market Participation /Sven Jari Stehn1st ed.Washington, D.C. :International Monetary Fund,2009.1 online resource (36 p.)IMF Working PapersDescription based upon print version of record.9781451917130 1451917139 Includes bibliographical references.Contents; I. Introduction; II. The Baseline Model; A. Households; B. Firms and Price Setting; C. Fiscal Policy; D. Aggregation and Market Clearing; E. Steady State and Linearisation; III.Equilibrium, Calibration and Determinacy; A. Equilibrium; B. Calibration; C. Determinacy; IV.Optimal Policy; Figures; 1. Determinacy in the baseline model; A. Social Welfare; B. Optimal Monetary Policy with Exogenous Fiscal Policy; C. Jointly Optimal Monetary and Fiscal Policy; 2. Optimal feedback coeffcients for different values of; 3. Impulse responses to a persistent cost-push shock in the baseline modelV. Extensions A. CRRA Preferences; B. Targeted Transfers; 4. Impulse responses to a persistent cost-push shock with CRRA utility, targeted transfers and equal lump-sum tax financing; C. Alternative Financing Assumptions; 5. Impulse responses to a persistent cost-push shock with government debt. .; VI.Conclusion; Appendix; A. Derivation of the Baseline Model; B. Derivation of the Social Welfare Function; C. Solving for Optimal Policy; D. Extensions; E. The 'non-Keynesian' Case; 6. Determinacy for the 'non-Keynesian case; ReferencesThis paper characterises the jointly optimal monetary and fiscal stabilisation policy in a new Keynesian model that allows for consumers who lacking access to asset markets consume their disposable income each period. With full asset market participation, the optimal policy relies entirely on the interest rate to stabilise cost-push shocks and government expenditure is not changed. When asset market participation is limited, there is a case for fiscal stabilisation policy. Active use of public spending raises aggregate welfare because it enables a more balanced distribution of the stabilisation burden across asset-holding and non-asset-holding consumers. The optimal response of government expenditure is sensitive to the financing scheme and whether the policymaker has access to a targeted transfer that can directly redistribute resources between consumers.IMF Working Papers; Working Paper ;No. 2009/137Consumption (Economics)Government policyFiscal policyCapital marketimfConsumptionimfEconomicsimfExpenditureimfExpenditures, PublicimfFinanceimfFinance: GeneralimfFiscal PolicyimfFiscal policyimfGeneral Financial Markets: General (includes Measurement and Data)imfIncome economicsimfLaborimfLabourimfMacroeconomicsimfMacroeconomics: ConsumptionimfNational Government Expenditures and Related Policies: GeneralimfPublic finance & taxationimfPublic FinanceimfReal wagesimfSavingimfSecurities marketsimfWagesimfWages, Compensation, and Labor Costs: GeneralimfWealthimfIrelandimfConsumption (Economics)Government policy.Fiscal policy.Capital marketConsumptionEconomicsExpenditureExpenditures, PublicFinanceFinance: GeneralFiscal PolicyFiscal policyGeneral Financial Markets: General (includes Measurement and Data)Income economicsLaborLabourMacroeconomicsMacroeconomics: ConsumptionNational Government Expenditures and Related Policies: GeneralPublic finance & taxationPublic FinanceReal wagesSavingSecurities marketsWagesWages, Compensation, and Labor Costs: GeneralWealth658.8;658.834Stehn Sven Jari1815911DcWaIMFBOOK9910961804603321Optimal Monetary and Fiscal Policy with Limited Asset Market Participation4371532UNINA