Can Stabilisation Policy Reduce Long-Run Growth?  

Oleh:

Blackburn, Keith

Jenis: Article from Journal - ilmiah internasional
Dalam koleksi: The Economic Journal (EBSCO) vol. 109 no. 452 (Jan. 1999), page 67-77.
Fulltext: 67.pdf (167.78KB)

Isi artikel

This paper presents an analysis of the long-run implications of short-term stabilisation policy. The analysis is based on a simple, stochastic model of an imperfectly competitive economy with nominal rigidities and an endogenous technology. By virtue of the latter, temporary shocks have permanent effects such that the cyclical and secular properties of output are related. In particular, smoother cyclical ¯uctuations may be associated with ¯atter secular trends, implying a trade-off between short-term stabilisation and long-term growth.

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