Fiscal and monetary policy interactions: a game theory approach

Saulo, Helton; Rêgo, Leandro Chaves; Divino, José Ângelo

doi:10.1007/s10479-013-1379-3

Cited by 20 publications

(20 citation statements)

References 23 publications

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“…Yet, there is still the need to use a repeated game model or a sequential (or dynamic) game model between monetary and fiscal authorities. Further research is suggested to use the dynamic game model, based on the Saulo et al (2013) theoretical framework.…”

Section: Discussionmentioning

confidence: 99%

Competition and Cooperation in Economics and Business

Husodo¹,

Gitaharie²,

Gani³

et al. 2017

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Although all care is taken to ensure integrity and the quality of this publication and the information herein, no responsibility is assumed by the publishers nor the author for any damage to the property or persons as a result of operation or use of this publication and/or the information contained herein. Business -Gani et al. (Eds) © 2018 Taylor & Francis Group, London, ISBN 978-1-138-62666-9 v Business -Gani et al. (Eds) © 2018 Taylor & Francis Group, London, ISBN 978-1-138-62666-9 ix Preface This book is one of the five volumes of proceedings that provides an opportunity for readers to engage with selected papers presented at the 1st Asia-Pacific Forum for Research in Social Sciences and Humanities (1st APRISH) conference held in Depok (Indonesia) on November 7-9, 2016. Quoting the theme of the conference "Competition and Cooperation in the Globalized World," this book would be a valuable contribution to get a better understanding of the future global challenges. Readers will find a broad range of research reports on topics ranging from globalization, poverty, population and some macroprudential perspectives on managing the risk of a more integrated world. One of the unique and valuable dimensions of this conference is the capability for blending the chemistries among educators, students, and researchers from around the world to discuss globalization in a broad spectrum. The reader will discover both common challenges and creative solutions emerge from very diverse settings. The relevance of the conference's theme, towards an evidence-based society, for a variety of disciplines, is reflected in the diverse range of papers that have been submitted for publication. These serve to demonstrate the natural attraction of the conference for sharing ideas and findings within an international community. Overall, the conference was undoubtedly very successful. Plenary lectures and presentations were successfully bridging the gap between the different fields of social sciences, making it possible for non-experts in a given area to gain insight into new areas. Also, among the speakers there were some young scientists, namely, doctoral, master's and undergraduate students, who bring new perspectives to their fields. Terms of use: Documents in EconStor may Competition and Cooperation in Economics and Competition and Cooperation in Economics andThe editors would like to thank all those who have contributed to submit full papers for this conference. We rece...

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Section: Discussionmentioning

confidence: 99%

Competition and Cooperation in Economics and Business

Husodo¹,

Gitaharie²,

Gani³

et al. 2017

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“…Studies on the interactions between monetary and fiscal policy have been conducted by Clarida et al (2000), Buti (2003), Canzoneri et al (2006), Flanagan et al (2011), Badarau and Levieuge (2011), Saulo et al (2013), andCui (2016), among others, all of whom considered the coordination of monetary and fiscal policy to be beneficial. At the same time, Libich and Nguyen (2015) show that such coordination might be problematic.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Coordinating these two policies is important for the economy because decisions made by one authority may have a negative impact on the other authority's results, causing a deterioration in the welfare of society. Coordinating fiscal and monetary policy should contribute to resolving conflicts of interest, as each decision-maker primarily deals with its goals (Saulo et al, 2013). Frankel and Rockett (1986) indicated that, overall, it would be better for countries to run a cooperative game than a non-cooperative one, in which each government sets its own policy regardless of the policy taken by the other side.…”

Section: Introductionmentioning

confidence: 99%

The Nash equilibrium in the policy mix model for Czechia, Hungary, and Romania

Stawska

Malaczewski

Malaczewska

et al. 2021

Cogent Economics & Finance

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The aim of the paper is to compare the sensitivity of a government's fiscal policy and a central bank's monetary policy, which are in Nash equilibrium in the case of a noncooperative game between the government and the central bank in Czechia, Hungary, and Romania. The analysis for each country is conducted from the date of its accession to the European Union. The research period for Czechia and Hungary includes the quarters 2004Q2-2019Q2, and for Romania, 2007Q1-2019Q2. The study has demonstrated that in Romania the government's response to interest rate changes is the strongest and the central bank's response to changes in the budget deficit turned out to be the weakest. On the other hand, the strongest response of the central bank to changes in the budget deficit turned out to be in Hungary, which means that the central bank in Hungary makes a significant correction of interest rates as a result of changes in the budget deficit.

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“…This type of model, and the structure of presentation of them, stem from the seminal work by Reference [27], and have been used from then when analyzing interactions among economic policies. See for instance References [28][29][30], and the references therein.…”

Section: Sustainable Economic Policies: a Simulation Exercisementioning

confidence: 99%

“…Notice that one of the features of macroeconomic models based on demand vs. supply analysis (see for instance References [28][29][30], and the references therein) is that at the aggregate level, a vast variety of economic policies (and even disturbances) lead to the same result (basically everything translates in changes of prices or/and output). However, given that the interest of the analysis it to find the most efficient way to achieve a specific result, in our particular analysis, we offer an array of results (in terms of welfare) to provide information about the conditions (in terms of demand-short-run oriented) under which a technological shock (supply-side, with long-run implications) would provide a higher level of welfare.…”

mentioning

confidence: 99%

Stabilization Policies and Technological Shocks: Towards a Sustainable Economic Growth Path

Bongers

Díaz‐Roldán

2019

Sustainability

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The purpose of this paper is to explore the extent to which traditional economic policies can be oriented by sound practices. It is becoming widely accepted that sustainable economic growth (and not only economic growth) is the final target of economic policies, but some economic policies are applied just looking to the short-run without taking in account the long-run perspective. Our aim is to show how a sustainable economic policy-making would be possible, making compatible the stabilization of the economy in the short-run with a sustainable economic growth in the long-run. We confront the design of economic policies with the 17 goals of the 2030 Agenda. We argue that all sustainable development goals can be attained by the design and implementation of sustainable economic policies. Finally, to illustrate this point, we will conduct a simulation exercise to show under which combinations of demand policies technological shocks would promote a path of sustainable growth. Our results will provide a reference framework for a sustainable economic policy-making.

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Fiscal and monetary policy interactions: a game theory approach

Cited by 20 publications

References 23 publications

Competition and Cooperation in Economics and Business

Competition and Cooperation in Economics and Business

The Nash equilibrium in the policy mix model for Czechia, Hungary, and Romania

Stabilization Policies and Technological Shocks: Towards a Sustainable Economic Growth Path

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