Optimal inflation persistence: Ramsey taxation with capital and habits

Journal of Monetary Economics

Volumn 54, Issue 6, 2007, Pages 1809-1836

  Chugh, Sanjay K ^a  

^a FEDERAL RESERVE BOARD   (United States)

Author keywords

Habit formation; Inflation persistence; Optimal fiscal and monetary policy; Ramsey model

Indexed keywords

EID: 34547665491     PISSN: 03043932     EISSN: None     Source Type: Journal    
DOI: 10.1016/j.jmoneco.2006.07.005     Document Type: Article

References (26)

1. Aiyagari S.R., Albert M., Sargent T.J., and Seppala J. Optimal taxation without state-contingent debt. Journal of Political Economy 110 (2002) 1220-1254
2. Angeletos G.-M. Fiscal policy with noncontingent debt. Quarterly Journal of Economics 117 (2002) 1105-1131
3. Angeletos, G.-M., 2004. Comment on Beningo and Woodford: optimal monetary and fiscal policy. NBER Macroeconomics Annual 2003.
4. Aruoba, S.B., Fernandez-Villaverde, J., Rubio-Ramirez, J.F., 2006. Comparing solution methods for dynamic equilibrium economies. Journal of Economic Dynamics and Control 30, 2477-2508.
5. Atkeson A., Chari V.V., and Kehoe P.J. Taxing capital income: a bad idea. Federal Reserve Bank of Minneapolis Quarterly Review 23 (1999) 3-17
6. Barro R.J. On the determination of the public debt. Journal of Political Economy 87 (1978) 940-971
7. Benigno, P., Woodford, M., 2006. Optimal taxation in an RBC model: A linear-quadratic approach. Journal of Economic Dynamics and Control, 30, 1445-1489.
8. Campbell J.Y., and Cochrane J.H. By force of habit: a consumption-based explanation of aggregate stock market behavior. Journal of Political Economy 107 (1999) 205-251
9. Chari, V.V., Kehoe, P.J., 1999. Optimal fiscal and monetary policy. In: Taylor, J.B., Woodford, M. (Eds.), Handbook of Macroeconomics, vol. 1c. Elsevier, Amsterdam.
10. Chari V.V., Christiano L., and Kehoe P. Optimal monetary and fiscal policy: some recent results. Journal of Money, Credit, and Banking 23 (1991) 519-539
11. Chen X., and Ludvigson S. Land of Addicts? An Empirical Investigation of Habit-Based Asset Pricing Models (2004), New York University
12. Chugh, S.K., 2004. Does monetary policy keep up with the Joneses? Optimal interest-rate smoothing with consumption externalities. International Finance Discussion Paper No. 812, Board of Governors of the Federal Reserve System.
13. Hall R.E. Macroeconomic fluctuations and the allocation of time. Journal of Labor Economics 15 (1997) S223-S250
14. Judd K.L. Capital income taxation with imperfect competition. American Economic Review 92 (2002) 417-421
15. King, R.G., Rebelo, S.T., 1999. Resuscitating real business cycles. In: Taylor, J.B., Woodford, M. (Eds.), Handbook of Macroeconomics, vol. 1B. Elsevier, Amsterdam.
16. Lucas, R. E., Stokey, N. L., 1983. Optimal Fiscal and Monetary Policy in an Economy without Capital. Journal of Monetary Economics 12, 55-93.
17. Mankiw N.G. The optimal collection of seignorage. Journal of Monetary Economics 20 (1987) 327-341
18. Pivetta, F., Reis, R., 2006. The persistence of inflation in the United States. Journal of Economic Dynamics and Control, forthcoming.
19. Ravn, M., Schmitt-Grohe, S., Uribe, M., 2006. Deep Habits. Review of Economic Studies 73, 195-218.
20. Schmitt-Grohe S., and Uribe M. Optimal fiscal and monetary policy under imperfect competition. Journal of Macroeconomics 26 (2004) 183-209
21. Schmitt-Grohe S., and Uribe M. Optimal fiscal and monetary policy under sticky prices. Journal of Economic Theory 114 (2004) 198-230
22. Schmitt-Grohe S., and Uribe M. Solving dynamic general equilibrium models using a second-order approximation to the policy function. Journal of Economic Dynamics and Control 28 (2004) 755-775
23. Shin Y. Optimal Fiscal Policy with Incomplete Markets (2003), Stanford University
24. Siu H.E. Optimal fiscal and monetary policy with sticky prices. Journal of Monetary Economics 51 (2004) 576-607
25. Uhlig H. Comments on optimal fiscal and monetary policy under imperfect competition. Journal of Macroeconomics 26 (2004) 211-217
26. Woodford, M. 2003. Interest and Prices: Foundations of a Theory of Monetary Policy. Princeton University Press.