Monetary and Fiscal Dynamicsby Michael Carlberg
Pub. Date: 07/01/1992
Publisher: Springer-Verlag New York, LLC
The analysis will be conducted within an IS-LM model augmented by the dynamics of money wages, private capital andpublic debt. A macroeconomic shock induces an extendedprocess of adjustment that is characterized by unemployment.This in turn requires a dynamic path of monetary and fiscalpolicy: As a response to the shock, the central bankcontinuouslyadapts the quantity of money so as to keep upfull employment all the time. And the governmentcontinuously accommodates its purchases of goods andservices. Can this be sustained? Or will public debt tend toexplode, thereby driving the stock of capial down to zero?
and post it to your social network
Most Helpful Customer Reviews
See all customer reviews >