文档介绍：【PPT精品课件】货币金融学7版英文课件--ch27-大学课
Cost-Push Inflation
High Employment Target at Yn
1. Workers raise wages because eitheally, ., as in Fig
Conclusion: Deficit , only if it is
1. Persistent
2. Financed by money creation rather than by bonds
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Budget Deficits and
Budget deficits in other countries
1. Bond finance hard
2. Deficit likely to lead to money creation and
Budget deficits in .
1. Large capital market, so can bond finance
2. Fed has choice whether to monetize deficit, but may be pressured to do so
3. Ricardian equivalence may mean no effect of budget deficits on interest rates
Conclusion: Deficits do not necessarily
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Budget Deficits and Interest Rates
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Inflation and Money Growth
1. Money and inflation relationship close until 1980
2. After 1980 relationship breaks down
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Government Debt to GDP
1. Debt/GDP falls 1960–80
2. Deficits can’t be source of money creation and
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Unemployment and the Natural Rate of Unemployment
High employment targets source of 1960-80
1. U < Un 1965-73 suggests demand-pull , with YT > Yn
2. U > Un 1974-80 suggests cost-push
3. U > Un and after 1980
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Activist/Nonactivist Debate
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Activist/Nonactivist Debate
Case for nonactivist policy stronger if expectations of policy matter
1. Economy won’t stop at point 2
2. Wages , AS shifts in, Y < Yn, AD shifted out, etc.:
3. Also less likely for wage push that gets us to 1'
Quite plausible that expectations of policy matter to wage setting
Rules vs Discretion
1. Nonactivists advocate policy rule to keep AD from fluctuating:
Example: Monetarist constant-money-growth-rate-rule
2. Credibility of nonaccommodating policy helps avoid wage push and helps prevent and unemployment
Example:
1. In the peri