Fiscal and monetary policy in new Keynesian DSGE models

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PhD thesis (EN)

2014 (EN)
Fiscal and monetary policy in new Keynesian DSGE models

Βαρθαλίτης, Πέτρος
Varthalitis, Petros

This thesis is about monetary and fiscal policy in New Keynesian DSGE models. Chapter 2 presents the baseline New Keynesian DSGE model. Monetary policy is in the form of a simple interest rate Taylor-type policy rule, while fiscal policy is exogenous. Chapter 3 extends the model of Chapter 2 to include fiscal policy. Now, both monetary and fiscal policy are allowed to follow feedback rules. Chapter 4 sets up a New Keynesian model of a semi-small open economy with sovereign risk premia. Finally, Chapter 5 builds a New Keynesian DSGE model consisting of two heterogeneous countries participating in a monetary union.Throughout most of the thesis, policy is conducted via "simple", "implementable" and "optimized" feedback policy rules. Using such rules, the aim of policy is twofold: firslty, it aims to stabilize the economy when the latter is hit by shocks; secondly, it aims to improve the economy's resource allocation.

DSGE models

Εθνικό Κέντρο Τεκμηρίωσης (ΕΚΤ) (EL)
National Documentation Centre (EKT) (EN)



Athens University Economics and Business (AUEB)
Οικονομικό Πανεπιστήμιο Αθηνών


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