Episode notes
Episode Notes: Monetary Policy with Declining Deficits
Read more- Introduction:
- Context: Introduction to the topic of fiscal dominance and its implications for monetary policy.
- Paper's Focus: Discussion on the research of Rodolfo E Manuelli and Juan I. Vizcaino, using Argentine monetary policy as a backdrop.
- Fiscal Dominance Explained:
- Definition: Fiscal dominance as a scenario where government's fiscal policy dominates monetary policy, possibly due to a large budget deficit.
- Implications: The potential difficulties for a central bank to control inflation when fiscal decisions take precedence.
- Manuelli and Vizcaino’s Model:
- DSGE Model ...