Optimal monetary policy in a New Keynesian model with endogenous growth
University of Rome 'Tor Vergata'; University of Pavia
New Keynesian model with endogenous growth via learning-by-doing (Romer 1986 AK technology with knowledge spillovers external to firms), Calvo staggered pricing, capital accumulation, and government spending financed by lump-sum taxes
intermediate firms: monopolistic competition with Calvo pricing; final firms: perfect competition with CES aggregation
Section 3.1 p.280
Ramsey optimal steady-state inflation in NK model with endogenous growth and knowledge spillovers
Authors state this is the main finding: 'the steady-state inflation rate associated with the Ramsey optimal policy turns out to be zero'