Score contribution per author:
α: calibrated so average coauthorship-adjusted count equals average raw count
Using a model of intertemporally optimizing households, this paper establishes that fiscal policy needs to be endogenous to preempt instability if one wishes to permit any combination of money and debt finance. Conservative governments enforce a greater margin of preemption than liberal governments. This distinction can generate very different short- and long-run effects on inflation when exogenous financial and fiscal policy variables are altered. Copyright 1987 by Royal Economic Society.