European Parliament Library

Monetary Policy and Public Finances :, Inflation Targets in a New Perspective, Christian Beddies

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Other version
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Label
Monetary Policy and Public Finances :, Inflation Targets in a New Perspective, Christian Beddies
Language
eng
Abstract
This paper considers the interaction between the private sector, the monetary authority, and the fiscal authority, and concludes that unrestricted central bank independence may not be an optimal way to collect seigniorage revenues or stabilize supply shocks. Moreover, the paper shows that the implementation of an optimal inflation target results in optimal shares of government finances—seigniorage, taxes, and the spending shortfall—from society’s point of view but still involves suboptimal stabilization. Even if price stability is the sole central bank objective, a positive inflation target has important implications for the government’s finances, as well as for stabilization
resource.governmentPublication
international or intergovernmental publication
Literary form
non fiction
Main title
Monetary Policy and Public Finances :
Nature of contents
dictionaries
Responsibility statement
Christian Beddies
Series statement
IMF Working Papers
Sub title
Inflation Targets in a New Perspective