Note on Money-Financed Policy
11 Pages Posted: 2 May 2017
Date Written: May 25, 2019
This note summarizes the outline of "money-financed policy." We review some policies for improving fiscal balance, and insist that money-financed policy has the greatest potential to increase social welfare as compared to other policies.
Also, we show the effect of money-financed policy on GDP using Eggertsson, Mehrotra and Robbins (2017) model.
Keywords: integrated government budget constraint, government bonds, money-financed policy
JEL Classification: E31, E52, E58, E61, E62
Suggested Citation: Suggested Citation