Who is afraid of the Friedman rule?

Arbeitspapier

We explore the connection between optimal monetary policy and heterogeneity among agents. We utilize a standard monetary economy with two types of agents that differ in the marginal utility they derive from real money balances — a framework that produces a nondegenerate stationary distribution of money holdings. Without type-specific fiscal policy, we show that the zero-nominal-interest-rate policy (the Friedman rule) does not maximize type-specific welfare; further, it may not maximize aggregate ex ante social welfare. Indeed one or, more surprisingly, both types of agents may benefit if the central bank deviates from the Friedman rule.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: Staff Report ; No. 208

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Price Level; Inflation; Deflation ; Money Supply; Credit; Money Multipliers ; Central Banks and Their Policies
• Thema: Geldpolitik ; Regelgebundene Politik ; Zinspolitik ; Geldmengensteuerung ; Theorie

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Bhattacharya, Joydeep ; Haslag, Joseph ; Martin, Antoine ; Singh, Rajesh
• Ereignis: Veröffentlichung
• (wer): Federal Reserve Bank of New York
• (wo): New York, NY
• (wann): 2005

Weitere Informationen

• Handle: http://hdl.handle.net/10419/60673
• Letzte Aktualisierung: 10.03.2025, 11:44 MEZ