The Fiscal Theory of the Price Level (eBook)

John H. Cochrane (Autor)

eBook Download: PDF

2023
584 Seiten
Princeton University Press (Verlag)
978-0-691-24324-5 (ISBN)

Infos

A comprehensive account of how government deficits and debt drive inflationWhere do inflation and deflation ultimately come from? The fiscal theory of the price level offers a simple answer: Prices adjust so that the real value of government debt equals the present value of taxes less spending. Inflation breaks out when people don't expect the government to fully repay its debts. The fiscal theory is well suited to today's economy: Financial innovation undermines money demand, and central banks don't control the money supply or aggressively change interest rates, invalidating classic theories, while large debts and deficits threaten inflation and constrain monetary policy. This book presents a comprehensive account of this important theory from one of its leading developers and advocates.John Cochrane aims to make fiscal theory useful as a conceptual framework and modeling tool, and for analyzing history and policy. He merges fiscal theory with standard models in which central banks set interest rates, giving a novel account of monetary policy. He generalizes the theory to explain data and make realistic predictions. For example, inflation decreases in recessions despite deficits because discount rates fall, raising the value of debt; specifying that governments promise to partially repay debt avoids classic puzzles and allows the theory to apply at all times, not just during periods of high inflation. Cochrane offers an extensive rethinking of monetary doctrines and institutions through the eyes of fiscal theory, and analyzes the era of zero interest rates and post-pandemic inflation.Filled with research by Cochrane and others, The Fiscal Theory of the Price Level offers important new insights about fiscal and monetary policy.

Produkt-Details

• Erscheint lt. Verlag: 17.1.2023
• Zusatzinfo: 55 b/w illus. 6 tables.
• Sprache: englisch
• Themenwelt: Wirtschaft ► Allgemeines / Lexika
• Themenwelt: Wirtschaft ► Volkswirtschaftslehre ► Finanzwissenschaft
• Themenwelt: Wirtschaft ► Volkswirtschaftslehre ► Makroökonomie
• Schlagworte: accounting rate of return • Asset price inflation • Bond Yield • Central Bank • Consumer Debt • Consumer economy • Consumption (Economics) • Credit (finance) • credit risk • Credit spread (options) • Currency • Currency Crisis • Currency swap • Currency Union • debt • debt limit • Debt-to-GDP ratio • Default (finance) • Diversification (finance) • Econometrics • Economic equilibrium • Economic planning • Economics • Exchange Rate • Finance • Financial correlation • Financial Economics • Fiscal Adjustment • fiscal gap • fiscal multiplier • Fiscal Policy • Fiscal Space • Fiscal theory of the price level • Fixed exchange-rate system • Functional finance • GDP deflator • GDP-linked bond • Government budget balance • Government Debt • Inflation • Inflation swap • Inflation Targeting • Inflation Tax • Interest Cost • Interest Rate • interest rate risk • Keynesian Economics • Liability (financial accounting) • Liquidity Premium • Macroeconomic model • Macroeconomics • marginal rate of substitution • Market Clearing • market liquidity • Market Price • market risk premium • Mark-to-market accounting • Microeconomic reform • Modern Monetary Theory • Monetarism • monetary authority • monetary policy • Monetary Reform • monetary system • Monetary Theory • money market • Money multiplier • Nominal interest rate • price change • Price controls • Price elasticity of demand • Price Fixing • Price index • price level • Public Finance • Quantity theory of money • Real business-cycle theory • Real interest rate • Real versus nominal value (economics) • Relative value (economics) • Risk Premium • Share Price • stochastic discount factor • Stock valuation • Supply (economics) • supply-side economics • Swap (finance) • Tax • tax and spend • tax avoidance • Tax Policy • Tax Reform • Terminal value (finance) • The general theory of employment, interest and money • The Wealth Effect • Tight Monetary Policy • Trade Credit • treasury bill • Valuation (finance) • Value (economics)
• ISBN-10: 0-691-24324-7 / 0691243247
• ISBN-13: 978-0-691-24324-5 / 9780691243245