Monetary Policy in a New Keynesian Model with Endogenous Growth

Arbeitspapier

We study monetary policy in a New Keynesian (NK) model with endogenous growth and knowledge spillovers external to each firm. We find the following results: (i) technology and government spending shocks have different effects on growth; (ii) disinflationary monetary policies entail positive effects on growth; (iii) the optimal long-run inflation rate is zero; (iv) the Ramsey dynamics implies deviation from full inflation targeting in response to technology and government spending shocks; (v) the optimal operational rule is backward looking and responds to inflation and output deviations from their long-run levels.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Quaderni di Dipartimento ; No. 167

Classification and Topics

• Classification: Wirtschaft ; Business Fluctuations; Cycles ; Monetary Policy ; Monetary Growth Models
• Subject: Monetary Policy ; Endogenous Growth ; Disinflation ; Ramsey Problem ; Optimal Simple Rules

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Annicchiarico, Barbara ; Rossi, Lorenza
• Event: Veröffentlichung
• (who): Università degli Studi di Pavia, Dipartimento di Economia Politica e Metodi Quantitativi (EPMQ)
• (where): Pavia
• (when): 2012

Further information

• Handle: http://hdl.handle.net/10419/95339
• Last update: 10.03.2025, 11:42 AM CET