Fiscal Activism Under Inflation Targeting and Non‐atomistic Wage Setting
Bibliographic Data
| ID | 9723700 |
|---|---|
| Authors | Anna Larsson (0000-0002-3129-1715, Stockholm University, corresponding author) |
| Year | 2012 |
| Volume | 79 |
| Issue | 313 |
| Pages | 97-114 |
| Publication date | 2012-01-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | Economica (JOURNAL) |
| Journal identifiers | ISSN: 0013-0427 • E-ISSN: 1468-0335 |
| Publisher | Wiley (PUBLISHER • GB) |
| DOI | 10.1111/j.1468-0335.2010.00873.x |
| OpenAlex | W2159387726 |
| Language | EN |
| References cited | 16 |
This paper presents a game between a fiscal authority, an independent central bank and non‐atomistic wage setters. The effects of fiscal activism and inflation targeting on labour market outcomes are analysed. The results suggest that inflation targeting provides incentive for wage restraint. Moreover, real wages are increasing in the degree of fiscal activism as wage setters exploit the response of a fiscal authority seeking to promote employment. Numerical results suggest that the benefits of targeting inflation are larger when the government pursues an activist policy and therefore that there is some substitutability between fiscal and monetary rules
Economics · Exploit · Fiscal policy · Government (linguistics) · Incentive · Inflation (cosmology) · Inflation targeting · Labour economics · Macroeconomics · Market economy · Monetary economics · Monetary policy · Wage · Economic Theory and Policy · Fiscal Policy and Economic Growth · Monetary Policy and Economic Impact
| Citation velocity | historical |
|---|---|
| Highly cited | No |