This paper analyzes the quantitative significance of Sargent and Wallace's (1981) "Some Unpleasant Monetarist Arithmetic" in a model that is parameterized to correspond with U.S. data. The major result is that the monetarist arithmetic is not overly unpleasant and that the nominal side of the...

This paper studies the effects of fiscal policies -- depicted as stochastic changes in government spending and distortionary tax rates -- when the government cannot use lump sum taxes to achieve intertemporal budget balance. This framework contrasts the more standard analysis in which spending...

This paper analyzes the quantitative significance of Sargent and Wallace's (1981) "Some Unpleasant Monetarist Arithmetic" in a model that is parameterized to correspond with U.S. data. The major result is that the monetarist arithmetic is not overly unpleasant and that the nominal side of the...

This paper studies the effects of fiscal policies -- depicted as stochastic changes in government spending and distortionary tax rates -- when the government is constrained from using lump sum taxes for achieving intertemporal budget balance. The ratio of debt to gnp, therefore, has consequences...

This paper studies the effects of fiscal policies--depicted as stochastic changes in government spending and distortionary tax rates--when the government cannot use lump sum taxes to achieve intertemporal budget balance. This framework contrasts the more standard analysis in which spending and...

This paper studies the effects of fiscal policies--depicted as stochastic changes in government spending and distortionary tax rates--when the government is constrained from using lump sum taxes for achieving intertemporal budget balance. The ratio of debt to gnp, therefore, has consequences for...