Arthur Galego Mendes; Berriel, Tiago (Advisor). Essays on Monetary and Fiscal Policy. Rio de Janeiro, 2018. 179p. Tese de doutorado -Departamento de Economia, Pontifícia Universidade Católica do Rio de Janeiro. This thesis is composed of 3 chapters. In the first chapter, It's shown that when a central bank is not fully financially backed by the treasury and faces a solvency constraint, an increase in the size or a change in the composition of its balance sheet (quantitative easing -QE) can

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... as a commitment device in a liquidity trap scenario. In particular, when the short-term interest rate is at the zero lower bound, open market operations by the central bank that involve purchases of long-term bonds can help mitigate deflation and recession under a discretionary policy equilibrium. Using a simple endowment-economy model, it's shown that a change in the central bank balance sheet, which increases its size and duration, provides an incentive to the central bank to keep interest rates low in the future to avoid losses and satisfy its solvency constraints, approximating its full commitment policy. In the second chapter, the validity of the novel mechanism developed in chapter 1 is tested by incorporating a financiallyindependent central bank into a medium-scale DSGE model based on Smets and Wouters (2007), and calibrating it to replicate key features of the expansion of size and composition of the Federal Reserve's balance sheet in the post-2008 period. I find that the programs QE 2 and 3 generated positive e ects on the dynamics of inflation, but mild e ects on the output gap. The third chapter of the thesis evaluates the welfare consequences of simple fiscal rules in a model of a small commodity-exporting country with a share of financially constrained households, where fiscal policy takes the form of transfers. The main finding is that balanced budget rules for commodity revenues often outperform more sophisticated fiscal rules where commodity revenues are saved in a Sovereign Wealth Fund. Because commodity price shocks are typically highly persistent, the households' current income is close to their permanent income, so commodity price shocks don't need smoothing, making simple balanced budget rules close to optimal.