Policy reform and optimal inflation rate for Japan in computable OLG economy

Manabu Shimasawa and Akira Sadahiro

Economic Modelling, 2009, vol. 26, issue 2, 379-384

Abstract: We build a computable OLG model with monetary growth to calculate the optimal level of inflation rate for Japan, and to study policy reforms make any quantitative impacts on it. Four main results were obtained: (i) the optimal inflation rate for Japan is calculated around 1.0%; (ii) the calculated underlying inflation rate is about 9% under the present Japanese economic and fiscal situation; (iii) to prevent high inflation, fiscal reconstruction needs to be implemented; and (iv) if fundamental fiscal reform is conducted, the optimal inflation rate might be achieved. These results are very robust to calibration.

Keywords: Money-in-the-utility; Overlapping; generations; Calibration; Optimal; inflation; rate; Fiscal; reform (search for similar items in EconPapers)
Date: 2009
References: Add references at CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0264-9993(08)00108-9
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:26:y:2009:i:2:p:379-384

Access Statistics for this article

Economic Modelling is currently edited by S. Hall and P. Pauly

More articles in Economic Modelling from Elsevier
Bibliographic data for series maintained by Catherine Liu ().