Fiscal disciplining effect of central bank opacity: Stackelberg versus Nash equilibrium

In a Stackelberg equilibrium, central bank opacity has a fiscal disciplining effect in the sense that it induces the government to reduce taxes and public expenditures, leading hence to lower inflation and output distortions. This effect could disappear or be dominated by the direct effect of opacity when the fiscal and monetary authorities play a Nash game.

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Year of publication:	2011
Authors:	Dai, Meixing ; Sidiropoulos, Moïse

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Type of publication:	Book / Working Paper
Language:	English
Notes:	Dai, Meixing and Sidiropoulos, Moïse (2011): Fiscal disciplining effect of central bank opacity: Stackelberg versus Nash equilibrium.
Classification:	E62 - Fiscal Policy; Public Expenditures, Investment, and Finance; Taxation ; E58 - Central Banks and Their Policies ; E52 - Monetary Policy (Targets, Instruments, and Effects) ; H30 - Fiscal Policies and Behavior of Economic Agents. General ; E63 - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization
Source:	BASE

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