Arbeitspapier
Monetary Policy in a New Keynesian Model with Endogenous Growth
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.
- Language
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Englisch
- Bibliographic citation
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Series: Quaderni di Dipartimento ; No. 167
Business Fluctuations; Cycles
Monetary Policy
Monetary Growth Models
Endogenous Growth
Disinflation
Ramsey Problem
Optimal Simple Rules
Rossi, Lorenza
- Handle
- Last update
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20.09.2024, 8:22 AM CEST
Data provider
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Object type
- Arbeitspapier
Associated
- Annicchiarico, Barbara
- Rossi, Lorenza
- Università degli Studi di Pavia, Dipartimento di Economia Politica e Metodi Quantitativi (EPMQ)
Time of origin
- 2012