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• W2093490930 abstract "Abstract In a cashless economy with strictly inflation-forecast-targeting interest rate policy, recent research shows that in the presence of distorting taxes, a balanced-budget taxation policy is likely to induce indeterminacy of equilibrium but a debt-targeting one is not, suggesting that short-run budget deficits play a role in stabilizing the economy. The present paper finds that this result is overturned in a monetary economy with flexibly inflation-forecast-targeting interest rate policy. The balanced-budget policy is likely to ensure determinacy together with the flexibly inflation-forecast-targeting policy, but the debt-targeting one may lead to indeterminacy in the monetary economy." @default.
• W2093490930 created "2016-06-24" @default.
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• W2093490930 date "2010-03-01" @default.
• W2093490930 modified "2023-09-26" @default.
• W2093490930 title "Distortionary taxation and interest rate policy" @default.
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• W2093490930 doi "https://doi.org/10.1016/j.jmacro.2009.11.002" @default.
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