| Tekijä: | Muscatelli, V. A. Tirelli, P. |
| Otsikko: | Credibility and monetary policy in a model with growth |
| Lehti: | Oxford Economic Papers
1998 : OCT, VOL. 50:4, p. 644-662 |
| Asiasana: | Monetary policy Growth Macroeconomics Inflation Models |
| Kieli: | eng |
| Tiivistelmä: | In the paper, the implications for monetary policy design of including learning-by-doing effects in a macroeconomic model are examined. It is shown that an inflation bias arises because monetary surprises may be exploited to maximize potential output by temporarily raising the rate of human capital accumulation. The model of the paper also provides an alternative explanation for the empirical evidence linking inflation and growth, where the causal link goes from low growth to high inflation. Unlike traditional credibility models, an inflationary bias can persist even when the authorities do not wish to offset labour market distortions through monetary surprises which undercut the median voter's income. |
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