Independent Monetary Policies and Social Equity

Andrew Hughes Hallett; D Weymark

doi:10.1016/j.econlet.2004.03.025

Independent Monetary Policies and Social Equity

Andrew Hughes Hallett, D Weymark

Research output: Contribution to journal › Article › peer-review

Abstract

Monetary policy is formulated as a game between the government and the central bank. We show that, when fiscal policy has a redistributional component, there is a conflict between optimally configured monetary policies and equality. Consequently, inflation averse governments interested in social equity will need to limit their use of fiscal policy. (C) 2004 Elsevier B.V. All rights reserved.

Original language	English
Pages (from-to)	103-110
Number of pages	8
Journal	Economics Letters
Volume	85
Issue number	85
DOIs	https://doi.org/10.1016/j.econlet.2004.03.025
Publication status	Published - Oct 2004

Keywords

monetary independence
central bank conservatism
monetary policy
income redistribution
FISCAL-POLICIES
COMMITMENT
DISCRETION

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10.1016/j.econlet.2004.03.025

Cite this

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title = "Independent Monetary Policies and Social Equity",

abstract = "Monetary policy is formulated as a game between the government and the central bank. We show that, when fiscal policy has a redistributional component, there is a conflict between optimally configured monetary policies and equality. Consequently, inflation averse governments interested in social equity will need to limit their use of fiscal policy. (C) 2004 Elsevier B.V. All rights reserved.",

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AB - Monetary policy is formulated as a game between the government and the central bank. We show that, when fiscal policy has a redistributional component, there is a conflict between optimally configured monetary policies and equality. Consequently, inflation averse governments interested in social equity will need to limit their use of fiscal policy. (C) 2004 Elsevier B.V. All rights reserved.

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KW - central bank conservatism

KW - monetary policy

KW - income redistribution

KW - FISCAL-POLICIES

KW - COMMITMENT

KW - DISCRETION

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DO - 10.1016/j.econlet.2004.03.025

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VL - 85

SP - 103

EP - 110

JO - Economics Letters

JF - Economics Letters

IS - 85

ER -

Independent Monetary Policies and Social Equity

Abstract

Keywords

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