{"title":"Determinacy of Interest Rate Rules with Bond Transaction Services in a Cashless Economy","authors":"Massimiliano Marzo, P. Zagaglia","doi":"10.2139/ssrn.1300353","DOIUrl":null,"url":null,"abstract":"Canzoneri and Diba (2004) show that the Taylor principle is not a panacea for equilibrium determinacy in a model where bonds and money provide liquidity services to households. We consider a cashless New Keynesian model with two types of government bonds. One bond provides transaction services, whereas the other is used only as a store of value. We show that the Taylor principle is still sacrosanct, and that the results of Leeper (1991) are confirmed.","PeriodicalId":346619,"journal":{"name":"ERN: Computable General Equilibrium Models (Topic)","volume":"164 1","pages":"0"},"PeriodicalIF":0.0000,"publicationDate":"2008-10-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"11","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"ERN: Computable General Equilibrium Models (Topic)","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.2139/ssrn.1300353","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"","JCRName":"","Score":null,"Total":0}
引用次数: 11
Abstract
Canzoneri and Diba (2004) show that the Taylor principle is not a panacea for equilibrium determinacy in a model where bonds and money provide liquidity services to households. We consider a cashless New Keynesian model with two types of government bonds. One bond provides transaction services, whereas the other is used only as a store of value. We show that the Taylor principle is still sacrosanct, and that the results of Leeper (1991) are confirmed.
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