RESEARCH METHODS OF THE RELATIONSHIP OF MONETARY AND FISCAL POLICY

Abstract

The transition to inflation targeting policy implies the responsibility of the Central Bank for the dynamics of the general level of prices. However, the government's fiscal policy may make it difficult for the central bank to achieve inflation targeting. In connection with this research, the relationship between money and credit and fiscal policy is an important practical task. The article presents a review of the main approaches to modeling the interaction of fiscal and monetary policy as in theoretical, as well as in empirical research: the problem of choosing between the rate of inflow, the rate of production and the rate of inflation. , etc. It is noted that the fiscal and monetary policies together form powerful tools of influence on socio-economic development. In this regard, reconciliation of all elements of the macroeconomic policy, primarily the directions and goals of the fiscal and monetary policy, is an important condition for increasing its efficiency. The article shows that the final goal of the fiscal and monetary policy should not be price stability, nor the stability of the national currency, nor a deficit-free budget. These parameters constitute intermediate or instrumental goals. The strategic goal of fiscal and monetary policy is the general goal of macroeconomic policy maximizing public welfare, ensuring sustainable socio-economic development, and raising the standard of living and quality of society.