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    Good evaluation points that can be made for monetary and fiscal policy?

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    (Original post by Blyts-_)
    Good evaluation points that can be made for monetary and fiscal policy?

    Thanks
    I'll give you some for Monetary Policy.

    Time Lags
    Rules VS Discretion
    Lucas Critique
    Zero-Lower Bound
    Rational Expectations
    The Importance of Communication
    New dimensions post-crisis i.e. QE, Macroprudential etc
    Endogenous money supply - reserve-requirements have little effect
    Monetary policy is ineffective under a fixed exchange rate regime (Trillema)(Sterilization)
    Money neutrality in the long-run


    Ok, maybe some for Fiscal Policy too:

    Ricardian Equivalence
    Rational Expectations
    Slopes of supply and demand
    Shadow market - higher taxes (may) result in evasion/avoidance
    Politically difficult
    Flexible exchange rates make it less effective
    Effect depends on the nature or magnitude of private debt in the economy
    Laffer Curve
    Debt overhang? Austerity exacerbates the problem?


    Hope that's enough for now..
 
 
 
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