Inflation Bias, Time Inconsistency of Monetary and Fiscal Policies and Institutional Quality

	Inflation Bias, Time Inconsistency of Monetary and Fiscal Policies and Institutional Quality
International Journal of Business and Development Studies
مقاله 2، دوره 9، شماره 1، دی 2017، صفحه 27-45 اصل مقاله (573.64 K)
شناسه دیجیتال (DOI): 10.22111/ijbds.2017.3396
نویسندگان
Ali Hussein Samadi؛ Hussein Marzban؛ Sakine Owjimehr
چکیده
In developing countries, weak institutional quality can increase the probability of applying discretionary policies and can have a great impact on their double-digit inflation. Surico (2008) calculated inflation bias, but he considered just monetary policy and he did not pay attention to the institutions. Therefore, we design a model which considers the discretion in monetary and fiscal policies and the effect of the institutional quality. Then we calculate the inflation bias resulting from time inconsistency of monetary and fiscal policies by solving our model. In fact, we used a Barro- Gordon type model for our purpose. After solving the model, sensitivity analysis is done. The experimental results of the model, for Iran’s economy as a developing country, show high degree of inflation bias during 1991-2016 , furthermore, the weak institutional quality have positive effects on inflation bias.
کلیدواژه‌ها
Time Inconsistency؛ Institutional Quality؛ Inflation Bias

آمار تعداد مشاهده مقاله: 875 تعداد دریافت فایل اصل مقاله: 1,210

سامانه مدیریت نشریات علمی. طراحی و پیاده سازی از سیناوب