Wu, Jing Cynthia; Xie, Yinxi - National Bureau of Economic Research - 2022
rate together with QE or fiscal transfers, can stabilize three targets simultaneously: inflation, the aggregate output gap …We build a tractable New Keynesian model to jointly study four types of monetary and fiscal policy. We find … fiscal policy is fully tax financed. Compared with these three policies, conventional monetary policy is more inflationary …