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Debt Non-Neutrality, Policy Interactions, and Macroeconomic Stability

Linnemann, Ludger; Schabert, Andreas - Tinbergen Instituut - 2005

requires a stationary evolution of real public debt, which steers inflation expectations and rules out endogenous fluctuations …-push shocks, such that output and inflation variances can be lower than in a corresponding case where debt is neutral. …

Persistent link: https://www.econbiz.de/10011255848

Monetary Policy under a Fiscal Theory of Sovereign Default

Schabert, Andreas - Tinbergen Instituut - 2009

This paper examines equilibrium determination under different monetary policy regimes when the government might default on its debt. We apply a cash-in-advance model where the government does not have access to non-distortionary taxation and does not account for initial outstanding debt when it...

Persistent link: https://www.econbiz.de/10011256163

Exchange Rate Policy under Sovereign Default Risk

Schabert, Andreas - Tinbergen Instituut - 2011

We examine monetary policy options for a small open economy where sovereign default might occur due to intertemporal insolvency. Under interest rate policy and floating exchange rates the equilibrium is indetermined. Under a fixed exchange rate the equilibrium is uniquely determined and...

Persistent link: https://www.econbiz.de/10011256298

Sovereign Default and the Stability of Inflation Targeting Regimes

Schabert, Andreas; Wijnbergen, Sweder J.G. van - Tinbergen Instituut - 2011

beliefs a monetary policy, which aims to stabilize inflation through an active interest rate policy, will destabilize the …

Persistent link: https://www.econbiz.de/10011256513

Debt, Deficits, and Destabilizing Monetary Policy in Open Economies

Schabert, Andreas; Wijnbergen, Sweder van - Tinbergen Instituut - 2006

inflation stabilization. Unstable dynamics can occur when the CB is aggressively raising the interest rate in response to higher … expected inflation. The constraint on stabilizing interest rate policy is tighter the higher the primary deficit and the more … policy to be accommodating (passive). Inflation stabilization is nevertheless feasible if the CB uses an instrument not …

Persistent link: https://www.econbiz.de/10011256544

Central Bank Instruments, Fiscal Policy Regimes, and the Requirements for Equilibrium Determinacy

Schabert, Andreas - Tinbergen Instituut - 2006

, the money growth rate should not rise by more than one for one with inflation when the primary surplus is raised with … inflation -- to ensure local equilibrium determinacy. When the central bank links the supply of money to government bonds by … controlling the bond-to-money ratio, an inflation stabilizing policy can be implemented for both fiscal policy regimes. Local …

Persistent link: https://www.econbiz.de/10011257052

Sovereign Default and the Stability of Inflation Targeting Regimes

Schabert, Andreas; Wijnbergen, Sweder J.G. van - Tinbergen Institute - 2011

the presence of sovereign default beliefs a monetary policy, which aims to stabilize inflation through an active interest …

Persistent link: https://www.econbiz.de/10008916009

Exchange Rate Policy under Sovereign Default Risk

Schabert, Andreas - Tinbergen Institute - 2011

Persistent link: https://www.econbiz.de/10008838618

Distortionary taxation, debt, and the price level

Schabert, Andreas; von Thadden, Leopold - 2006

This paper considers the nominal and real determinacy of equilibria under an exogenously specified path of interest rates in an economy in which taxation is either lump-sum or distortionary. Under lump-sum taxation, we confirm the well-known finding that equilibria display nominal...

Persistent link: https://www.econbiz.de/10011604623

Fiscal Policy, Interest Rate Spreads, and the Zero Lower Bound

Bredemeier, Christian; Juessen, Falko; Schabert, Andreas - 2015

This paper questions unconventional fiscal policy effects when the monetary policy rate is at the zero lower bound. We provide evidence for the US that the spread between the policy rate and the US-LIBOR, which is more relevant for private sector transactions, increases with government...

Persistent link: https://www.econbiz.de/10010531696