Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/95339 
Year of Publication: 
2012
Series/Report no.: 
Quaderni di Dipartimento No. 167
Publisher: 
Università degli Studi di Pavia, Dipartimento di Economia Politica e Metodi Quantitativi (EPMQ), Pavia
Abstract: 
We study monetary policy in a New Keynesian (NK) model with endogenous growth and knowledge spillovers external to each firm. We find the following results: (i) technology and government spending shocks have different effects on growth; (ii) disinflationary monetary policies entail positive effects on growth; (iii) the optimal long-run inflation rate is zero; (iv) the Ramsey dynamics implies deviation from full inflation targeting in response to technology and government spending shocks; (v) the optimal operational rule is backward looking and responds to inflation and output deviations from their long-run levels.
Subjects: 
Monetary Policy
Endogenous Growth
Disinflation
Ramsey Problem
Optimal Simple Rules
JEL: 
E32
E52
O42
Document Type: 
Working Paper

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