optimal monetary and fiscal policies under commitment and discretion. With symmetric rigidities, fiscal policy will not be … the case under discretion. We conduct numerical analyses to assess the welfare gains from commitment and from having … rates and the terms of trade. Under commitment, both monetary policy and relative spending are inertial, while this is not …

. Second, we show that the commitment (time inconsistent) solution does not normally involve zero inflation and output at its …, we show that the timeless perspective policy has the same steady state as the commitment case, but without any short …

asynchronous game framework that generalises the standard commitment analysis. It allows concurrent and partial commitment; both … outcomes can be prevented if monetary commitment is sufficiently strong relative to fiscal commitment. Interestingly, monetary … commitment can not only resist fiscal pressure, but also discipline an ambitious fiscal policy maker to achieve socially …

public spending. Under commitment, optimal stabilization is obtained by combining an inflation target that is contingent on …

and discretion. Under commitment, we find that the deliberate choice of sloppy control is far less likely under a standard …We examine a central bank's endogenous choice of degree of control and degree of transparency, under both commitment … central-bank loss function than reported for a less standard loss function by Cukierman and Meltzer. Under discretion, maximum …