Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/306706 
Year of Publication: 
2024
Series/Report no.: 
Bank of Canada Staff Working Paper No. 2024-38
Publisher: 
Bank of Canada, Ottawa
Abstract: 
We assess whether unconventional monetary and fiscal policy implemented in response to the COVID-19 pandemic in the U.S. contribute to the 2021-2023 inflation surge through the lens of several different empirical methodologies-event studies, vector autoregressions, and regional panel regressions using granular data-and establish a null result. The key economic mechanism works through a disinflationary channel in the Phillips curve while monetary and fiscal stimuli put positive pressure on inflation through the usual demand channel. We illustrate this negative supply-side channel both theoretically and empirically.
Subjects: 
Inflation and prices
Monetary policy
Fiscal policy
Business fluctuations and cycles
Central bank research
JEL: 
E31
E52
E63
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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