We explore bifurcation phenomena in the open-economy New Keynesian model developed by Clarida, Gali and Gertler (2002). We find that the open economy framework can bring about more complex dynamics, along with a wider variety of qualitative behaviors and policy responses. Introducing parameters...

We explore bifurcation phenomena in the open-economy New Keynesian model developed by Gali and Monacelli (2005). We find that the open economy framework brings about more complex dynamics, along with a wider variety of qualitative behaviors and policy responses. Introducing parameters related to...

In this paper, we study the effectiveness of fiscal policies in a framework of a small open economy where the behaviour of representative consumer is characterised by endogenous time preference which depends on wealth and consumption.

The recent boom and bust in commodity prices has raised concerns about the impact of volatile commodity prices on Latin American countries’ fiscal positions. Using a novel quarterly dataset─ which includes unique country specific commodity price indices and a comprehensive measure of public...

The present paper treats the issue of economic foundations, on which political power rests, and the specific problem of public debt in the developed countries. Starting from the general question: “Why do rich governments borrow so much?” the paper develops a model of political power based on...

Public financial management by the government is very important in view of the level of welfare in Indonesia is still low, as there are still much poverty with the level of fulfillment of the needs of low, corruption that occurs in every area of government, income distribution is uneven, low...

From the policy mix theory to the related empirical works, quantifying the degree of coordination of monetary and fiscal policies seems to be missing. In this paper, we propose an index (ICPM) which measures the coherent nature of the policy mix rather than it restrictive or expansive character....

From the policy mix theory to the related empirical works, the quantification of the coordination of monetary and fiscal policies seems to be missing. In this paper, we propose an index (PMCI) which measures the coherent nature of the policy mix rather than it restrictive or expansive character....

Keynes’ original intention in introducing the concept of a liquidity trap was to explain the reason why persistent large amounts of unutilized resources were generated during the Great Depression. This paper shows that this type of phenomenon cannot be explained in the framework of a...