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Complementaries between fiscal policy and monetary policy : literature review / by Wei Dong, Geoffrey Dunbar, Christian Friedrich, Dmitry Matveev, Romanos Priftis and Lin Shao.FB3-6/2021-4E-PDF

"This paper reviews and summarizes the literature on the complementary relationship between fiscal policy and monetary policy. We focus on four types of fiscal policy: (1) automatic stabilizers, (2) state-contingent non-discretionary fiscal policy, (3) discretionary fiscal stimulus and (4) government credit policies. The literature shows that automatic fiscal stabilizers can play a role in stabilizing business cycle fluctuation. But because they can have multiple policy objectives, their optimal design remains an open question. An alternative policy framework features state-contingent non-discretionary fiscal expenditures with a pre-committed fiscal spending formula triggered by objective macroeconomic conditions. Such a policy offers the advantage of being timely and easy to communicate; but at the same time, it poses challenges for identifying appropriate triggers and program expenditures with high short-run multipliers"--Abstract, page ii.

Permanent link to this Catalogue record:
publications.gc.ca/pub?id=9.903071&sl=0

Publication information
Department/Agency
  • Bank of Canada, issuing body.
TitleComplementaries between fiscal policy and monetary policy : literature review / by Wei Dong, Geoffrey Dunbar, Christian Friedrich, Dmitry Matveev, Romanos Priftis and Lin Shao.
Series title
  • Staff discussion paper = Document d'analyse du personnel, 1914-0568 ; 2021-4
Publication typeMonograph - View Master Record
Language[English]
FormatDigital text
Electronic document
Note(s)
  • Cover title.
  • "March 15, 2021."
  • Includes bibliographical references (pages 22-29).
  • Includes abstracts in English and French.
Publishing information
  • Ottawa, Ontario, Canada : Bank of Canada = Banque du Canada, 2021.
  • ©2021
Author / Contributor
  • Dong, Wei, author.
Description1 online resource (iii, 29 pages) : graphs.
Catalogue number
  • FB3-6/2021-4E-PDF
Subject terms
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