ASSET INFLATION AND CREDIT EXPANSION IN AN OVERLAPPING GENERATIONS ECONOMY
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ASSET INFLATION AND CREDIT EXPANSION IN AN OVERLAPPING GENERATIONS ECONOMY
Annotation
PII
S042473880000616-6-1
Publication type
Article
Status
Published
Pages
89-103
Abstract

Asset inflation and credit expansion are considered as the instruments for implementation of long-term optimum for an overlapping generations model. We show the role of credit in supporting a high rate of asset price inflation, which outpaces the growth rate of GDP and provides optimal wealth allocation between generations. A link between optimal asset inflation and optimal monetary policy is demonstrated.

Keywords
asset inflation, credit expansion, overlapping generations, social welfare function, monetary policy
Date of publication
01.10.2014
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1
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862
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