Arbeitspapier
An overlapping generations model for monetary policy analysis
We integrate an overlapping generations model into a new monetarist framework and show that the Friedman rule is not optimal. This is because inflation makes saving for retirement less attractive, such that young agents optimally choose to increase their consumption at the expense of lower savings. On the other hand, old agents consume less due to the inflation tax. We show that for low inflation rates, the former effect dominates the latter, such that the Friedman rule is not optimal. However, this effect disappears for higher inflation rates such that the optimal rate is at an intermediate level.
- Language
-
Englisch
- Bibliographic citation
-
Series: Working Paper ; No. 272
- Classification
-
Wirtschaft
Micro-Based Behavioral Economics: General‡
Price Level; Inflation; Deflation
Demand for Money
Monetary Policy, Central Banking, and the Supply of Money and Credit: General
- Subject
-
Overlapping generations
monetary theory
Friedman rule
- Event
-
Geistige Schöpfung
- (who)
-
Huber, Samuel
Kim, Jaehong
- Event
-
Veröffentlichung
- (who)
-
University of Zurich, Department of Economics
- (where)
-
Zurich
- (when)
-
2017
- Handle
- Last update
-
10.03.2025, 11:42 AM CET
Data provider
This object is provided by:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Huber, Samuel
- Kim, Jaehong
- University of Zurich, Department of Economics
Time of origin
- 2017
Other Objects (12)
Money and monetary policy in overlapping generations (OLG) models
Policy Credibility in Numerical Overlapping Generations Models
Neoclassical Growth Model with Overlapping Generations
On overlapping generations models with productive capital
Learning and equilibrium selection in a monetary overlapping generations model with sticky prices
Learning and Equilibrium Selection in a Monetary Overlapping Generations Model with Sticky Prices
Quasilinear, Overlapping-Generations Economies
Social security and redistribution within generations in an overlapping generations model
Social security and redistribution within generations in an overlapping generations model
Inflation forecast targeting in an overlapping generations model
Endogenous Fertility in an Overlapping Generations Growth Model
Fiscal Consolidation and Climate Policy: An Overlapping Generations Perspective
Money and monetary policy in overlapping generations (OLG) models
Policy Credibility in Numerical Overlapping Generations Models
Neoclassical Growth Model with Overlapping Generations
On overlapping generations models with productive capital
Learning and equilibrium selection in a monetary overlapping generations model with sticky prices
Learning and Equilibrium Selection in a Monetary Overlapping Generations Model with Sticky Prices
Quasilinear, Overlapping-Generations Economies
Social security and redistribution within generations in an overlapping generations model
Social security and redistribution within generations in an overlapping generations model
Inflation forecast targeting in an overlapping generations model
Endogenous Fertility in an Overlapping Generations Growth Model
Fiscal Consolidation and Climate Policy: An Overlapping Generations Perspective
Money and monetary policy in overlapping generations (OLG) models
Policy Credibility in Numerical Overlapping Generations Models
Neoclassical Growth Model with Overlapping Generations
On overlapping generations models with productive capital
Learning and equilibrium selection in a monetary overlapping generations model with sticky prices
Learning and Equilibrium Selection in a Monetary Overlapping Generations Model with Sticky Prices
Quasilinear, Overlapping-Generations Economies
Social security and redistribution within generations in an overlapping generations model
Social security and redistribution within generations in an overlapping generations model
Inflation forecast targeting in an overlapping generations model
Endogenous Fertility in an Overlapping Generations Growth Model