Inflation, Welfare and Public Goods.

In this paper, we study the welfare effects of monetary policy in a simple overlapping generation economy in which agents voluntary contribute to a public good. Inflation has two effects at equilibrium: it increases voluntary contributions and it misallocates private consumption across time. We show that the aggregate effect is welfare improving or 'not too high' inflation rates. Moreover, there exists an optimal inflation rate.

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Year of publication:	1998
Authors:	Bloise, G. ; Currarini, S. ; Kikidis, N.
Institutions:	Center for Operations Research and Econometrics (CORE), École des Sciences Économiques de Louvain
Subject:	PUBLIC GOODS \| GENERATIONS \| INFLATION \| SOCIAL WELFARE (C.O.R.E.) \| LOUVAIN-LA-NEUVE BELGIQUE. 17p

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Series:	Papers.
Type of publication:	Book / Working Paper
Classification:	E4 - Money and Interest Rates ; E5 - Monetary Policy, Central Banking and the Supply of Money and Credit ; H40 - Publicly Provided Goods. General ; H41 - Public Goods ; H23 - Externalities; Redistributive Effects ; Environmental Taxes and Subsidies ; H55 - Social Security and Public Pensions
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005478918