Monetary Policy in a Life-Cycle Economy: Distributional Consequences of Monetary Policy Rule (joint with Yuki Teranishi)

東京大学経済学研究科棟 3階 第3教室

藤原一平 氏

In this paper, we answer to practically important questions concerning monetary policy implementation: whether the monetary policy scheme needs to be changed as societal aging deepens; and how monetary policy affects heterogeneous agents, namely workers and retirees, unevenly. According to simulation results from the dynamic stochastic general equilibrium model with nominal rigidity that incorporates lifecycle behavior a la Gertler (1999), monetary policy does not have to be altered significantly as societal ageing deepens. On the distributional aspects of monetary policy, however, we find that the optimal instrument rule for workers is quite different from the one for retires. In an economy where even workers save for their retirement as is the case in Japan, workers prefer more inflation-fighting monetary policy than retirees do and, therefore, the central bank faces policy trade-off between maximizing worker’s and retiree’s welfare.

備考: Macroworkshop と共催

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