Cash-in-advance constraint,optimal monetary policy,and human capital accumulation |
| |
Authors: | Mitsuyoshi Yanagihara Chen Lu |
| |
Affiliation: | 1. Graduate School of Economics, Nagoya University, Furo-Cho, Chikusa-Ku, Nagoya, Aichi 464-8601, Japan;2. Tan Kah Kee College, Xiamen University, Zhangzhou 363105, China |
| |
Abstract: | This paper investigates optimal monetary policy in an overlapping-generations model with endogenous growth fueled by the accumulation of human capital and under a cash-in-advance constraint. We consider the case where the government finances public education fully by seigniorage. Three main results are obtained. First, there exists an optimal money growth rate that maximizes the economic growth rate along the steady growth path. Second, on this path, the Laffer curve of seigniorage takes the maximum. Finally, the money growth rate for maximizing seigniorage along the steady growth path, which also leads to maximization of the economic growth rate, is lower than that for maximizing seigniorage in the present period. |
| |
Keywords: | Cash-in-advance constraint Optimal monetary policy Public education Human capital accumulation |
本文献已被 ScienceDirect 等数据库收录! |
|