We examine the effects of fiscal shocks on the performance of alternative monetary policy rules in a small dynamic general equilibrium framework. We explicitly consider the interaction between fiscal and monetary policy rules which may be present in the real world. We use a simple specification...

We evaluate the Taylor rule and the nominal income-targeting rule at alternative horizons, along the dimension of determinacy and E-stability of the rational expectations equilibrium. We use the New Keynesian model frequently used as a benchmark model for the evaluation of alternative monetary...