A new paper from the Philadelphia Fed makes an of import point:
Sumber https://gregmankiw.blogspot.com/
This newspaper examines how supply-side policies may play a business office inwards fighting a depression aggregate need that traps an economic scheme at the zilch lower natural springtime (ZLB) of nominal involvement rates. Future increases inwards productivity or reductions inwards mark-ups triggered past times supply-side policies generate a wealth upshot that pulls electrical flow consumption too output up. Since the economic scheme is at the ZLB, increases inwards the involvement rates utilization non undo this wealth effect, every bit nosotros volition accept inwards the illustration exterior the ZLB. We illustrate this machinery alongside a uncomplicated two-period New Keynesian model. We beak over possible objections to this ready of policies too the relation of supply-side policies alongside to a greater extent than conventional monetary too financial policies.
