Active or passive? Revisiting the role of fiscal policy during high inflation
通过分析1960-70年代大通胀，用序贯蒙特卡洛算法估计含三种货币-财政政策体制的DSGE模型，发现沃尔克之前被动货币与被动财政政策及财政主导共同驱动宏观动态，并应用于研究后疫情通胀。
We investigate the interplay of the monetary–fiscal policy mix during times of crisis by drawing insights from the Great Inflation of the 1960s and 1970s. We use a Sequential Monte Carlo (SMC) algorithm to estimate a DSGE model with three distinct monetary/fiscal policy regimes. We show that, in such a model, SMC outperforms standard sampling algorithms because it is better suited to deal with multimodal posteriors, an outcome that is highly likely in a DSGE model with monetary–fiscal policy interactions. From the estimation with SMC, a differentiated perspective results: pre-Volcker macroeconomic dynamics were similarly driven by passive monetary/passive fiscal policy and fiscal dominance. We apply these insights to study the post-pandemic inflation period.