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We analyse optimal monetary and fiscal policy in a New-Keynesian model with public debt and inflation persistence … striking result is not true with high degrees of inflation persistence. Secondly, we show that optimal fiscal policy is more … active under discretion than commitment at all degrees of inflation persistence and all levels of debt …
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inflation and not enough to spreads,and yield larger fluctuations in response to risk shocks. Reaction curves display shifts …
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control for the inflation rate. Fourth, traditional New Keynesian approaches analyze the impacts of fiscal stimuli on standard …
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