Inflation Targeting under Fiscal Fragility
研究了高政府债务负担下通胀目标制的运行机制，发现均衡通胀取决于债务水平，并存在一个“财政脆弱性”区间，提高通胀目标可能通过防止财政脆弱性来改善福利。
We propose a model to study an inflation-targeting regime under a high government debt burden. We assume that an altruistic policymaker chooses debt issuance, inflation, and public expenditure, while private agents dislike inflation and finance the government. We show that equilibrium inflation depends on debt level: (i) on-target when debt is low; (ii) above the target when debt is high; (iii) either above or on-target in between, a zone that we named fiscal fragility. Equilibrium inflation also depends on the target level: A higher target may improve welfare by preventing fiscal fragility and reducing debt-rollover costs.