Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/155175 
Year of Publication: 
2001
Series/Report no.: 
Nota di Lavoro No. 12.2001
Publisher: 
Fondazione Eni Enrico Mattei (FEEM), Milano
Abstract: 
In this paper we study the welfare effects of monetary policy in a simple overlapping generation economy in which agents voluntarily contribute to a public good. Inflation has two effects at equilibrium: it increases voluntary contributions and it misallocates private consumption across time. We show that the aggregate effect is welfare-improving for "not too large" inflation rates. Moreover, there exists an optimal inflation rate.
Subjects: 
Optimal inflation
public goods
voluntary contributions
JEL: 
H41
E52
D91
Document Type: 
Working Paper

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