Public spending, monetary policy and macroeconomic instability

2021 ◽  
Author(s):  
Zhiming Fu ◽  
Antoine Le Riche
Keyword(s):  
Monetary Policy ◽  
Public Spending ◽  
Macroeconomic Instability

scholarly journals MONETARY MEASURES AND CURRENCY REGULATION DURING MACROECONOMIC INSTABILITY AND WORLD UNCERTAINTY

2021 ◽  
Vol 6 (1) ◽  
pp. 65-71
Author(s):  
Alina Artemenko
Keyword(s):  
Monetary Policy ◽  
Foreign Exchange ◽  
Macroeconomic Fluctuations ◽  
Monetary System ◽  
Macroprudential Policies ◽  
The World ◽  
Macroeconomic Instability ◽  
Before And After ◽  
Global Economic Growth ◽  
And Control

This study is devoted to the comparative analysis of the rules of foreign exchange regulation and control, as well as monetary measures implemented in developed counties during 2003-2020. Accordingly, the purpose is to compare currency restrictions imposed as a response to several economic, political and epidemiological situations and determine their relevance. The study consists of three main parts. The first section highlights the evolution of the monetary policies of different countries during the rapid global economic growth (2003-2007) and key monetary novation before and after the 2008-2009 great recession (macroprudential approach to monetary regulation). The second section describes the world post-crisis monetary system in terms of foreign exchange regimes. Finally, in the third section, the main focus is directed on the period of the COVID-19 crisis and, eventually, key monetary policy measures imposed in the leading economic areas as a reaction to macroeconomic instability and world uncertainty. The practical implications of this study are noteworthy to consider as the problem is outlined in three aspects: 1) evolutionary (with a step-by-step analysis of economic events from 2003 to 2020); 2) instrumental (with analysis of the tools of monetary, macroprudential and monetary policy); 3) country (in the context of world uncertainty). In most cases, the results show that countries produce shocks that transferred to the rest of the world (spillbacks effect). Also, in a financially integrated world, macroprudential policies are valuable and essential because instability becomes a key defect of the modern market system. That is why monetary policy, especially after the crisis, is critical in stabilizing macroeconomic fluctuations.

Russia's development plan may be too broad to succeed

2019 ◽  
Keyword(s):  
Monetary Policy ◽  
Central Bank ◽  
Development Strategy ◽  
Rapid Growth ◽  
Public Support ◽  
Public Spending ◽  
Development Programme ◽  
Content Type ◽  
Funding Sources ◽  
Specific Activities

Subject Russia's six-year development strategy. Significance A year on from its announcement, Russia's development programme to 2024 has many unanswered questions about specific activities and funding sources. Nor is it clear whether the programme will generate rapid growth and other positive impacts by 2024, as planned. Impacts The national projects should be a way of rallying public support but fewer than half of Russians have heard of them. The inflationary risks of higher public spending may push the central bank towards restrictive monetary policy. Essential legal, administrative, tax and other reforms are not high on the agenda.

INNOVATION, GROWTH, AND OPTIMAL MONETARY POLICY

2019 ◽  
pp. 1-24
Author(s):  
Barbara Annicchiarico ◽  
Alessandra Pelloni
Keyword(s):  
Monetary Policy ◽  
Inflation Targeting ◽  
Public Spending ◽  
New Keynesian ◽  
Positive Trend ◽  
Policy Recommendation ◽  
Optimal Monetary Policy ◽  
Keynesian Model ◽  
Trend Inflation ◽  
Short Run

This paper examines how innovation-led growth affects optimal monetary policy. We consider the Ramsey policy in a New Keynesian model where R&D leads to an expanding variety of intermediate goods and compare the results with those obtained when the expansion occurs exogenously. Positive trend inflation is found to be optimal under both assumptions, but much higher with profit-seeking innovation. Optimal monetary policy must be counter-cyclical in response to both technology and public spending shocks, yet the intensity of the reaction crucially depends on the presence of an R&D sector. However, the small amount of short-run deviations of prices from the non-zero trend inflation observed in response to shocks suggests inflation targeting as a robust policy recommendation.

scholarly journals Vietnam’s macroeconomic instability from monetary policy perpecstive

2013 ◽  
Vol 16 (1) ◽  
pp. 68-80
Author(s):  
Dao Thi Thieu Ha ◽  
Trinh Thi Tuyet Pham
Keyword(s):  
Monetary Policy ◽  
Stock Price ◽  
Inflation Targeting ◽  
Frequency Change ◽  
Viet Nam ◽  
Policy Recommendations ◽  
Price Boom ◽  
Macroeconomic Instability ◽  
Monetary And Fiscal Policy

Macroeconomic instability Indices of Vietnam shows that Viet Nam actually falls in macroeconomic instability. In addition to the effect of external factors such as increased capital inflow fluctuation and global economic crisis, easy monetary and fiscal policy also lead to estate and stock price boom and finally expose Vietnam economy to instability. Among them, monetary policy is one of the main causes leading to this situation because of frequency change in policy, inconsistency of inflation targeting, lack of long-term policies and administrative measures. This paper also points out some policy recommendations for effectively controlling the instability.

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