Confidence, Credibility and Macroeconomic Policy

by Burdekin; Richard C. K.

• ISBN13: 9780415102780
• ISBN10: 0415102782
• Format: Hardcover
• Copyright: 1995-06-12
• Publisher: Routledge

Summary

Confidence, Credibility and Macroeconomic Policyexplores the interaction between fiscal and monetary stabilization, producer and consumer confidence and expectations and the credibility of the government's financial policies. For a government's economic policies to succeed, they must gain and maintain economic credibility, which many governments are finding increasingly difficult. Confidence, Credibility and Macroeconomic Policyis divided into three sections. Part I is an overview of the inter-relationship between fiscal policy and credibility and inflation. In addition, there are two pioneering studies that explore the effects of macroeconomic policies on expectations. Part II focuses on empirical research and presents historical as well as contemporary evidence on the importance of public confidence and expectations to the success of fiscal and monetary policy. Part III examines the definitions and functions of consumer confidence as it is measured today.This section also includes a study of its role in the 1990s and theoretical frameworks that explicitly incorporate confidence in macroeconomic stabilization.

Table of Contents

Foreword	p. xiii
Acknowledgements	p. xvii
Introduction	p. xix
Credibility in Practice and in Experimental Testing	p. 1
Fiscal Policy, Credibility and Inflation	p. 3
Bond-Financed Deficits, Taxation and Expectations	p. 28
Monetary Credibility and National Output	p. 45
Appendix: Instructions to Participants	p. 54
Confidence and Credibility Factors in Historical Perspective	p. 57
Public Confidence and Public Finance During the American Civil War	p. 59
Deficit Finance, Expectations and Real Money Balances	p. 90
Appendix	p. 108
Does Exchange Rate Pegging Foster Monetary Credibility?	p. 110
Consumer Confidence and Macroeconomic Stabilisation in the 1990s	p. 137
Consumer Confidence in Today's Macroeconomy	p. 139
Consumer Confidence and the Optimal Timing of Effective Monetary Stabilisation	p. 148
	p. 156
	p. 157
Consumer Confidence and Domestic Fiscal Stabilisation	p. 158
	p. 168
	p. 169
	p. 169
	p. 169
Notes	p. 170
Bibliography	p. 187
Index	p. 201
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