Liquidity traps and expectation dynamics: fiscal stimulus or fiscal austerity?

DOI10.1016/j.jedc.2014.05.021zbMath1402.91407OpenAlexW2104801013MaRDI QIDQ1994605

Seppo Honkapohja, George W. Evans, Jess Benhabib

Publication date: 1 November 2018

Published in: Journal of Economic Dynamics \& Control (Search for Journal in Brave)

Full work available at URL: http://www.nber.org/papers/w18114.pdf

zbMATH Keywords

adaptive learningmonetary policyfiscal policyzero interest rate lower bound

Mathematics Subject Classification ID

Applications of statistical and quantum mechanics to economics (econophysics) (91B80) Macroeconomic theory (monetary models, models of taxation) (91B64) Interest rates, asset pricing, etc. (stochastic models) (91G30)

Related Items

Stabilizing expectations at the zero lower bound: experimental evidence, Lack of confidence, the zero lower bound, and the virtue of fiscal rules, Learning about fiscal policy and the effects of policy uncertainty, EXPECTATIONS, STAGNATION, AND FISCAL POLICY: A NONLINEAR ANALYSIS, Coherence without rationality at the zero lower bound, Managing unanchored, heterogeneous expectations and liquidity traps, Learning to believe in secular stagnation, Stable near-rational sunspot equilibria, Shilnikov chaos, low interest rates, and New Keynesian macroeconomics

Cites Work

• Escapist policy rules
• Necessity of transversality conditions for stochastic problems.
• Economic Dynamics with Learning: New Stability Results
• The perils of Taylor rules