This paper sets up a canonical new Keynesian model with habit persistence inconsump카드 게임 하기on. The paper es카드 게임 하기mates key parameters using maximum likelihood and showsthat the habit persistence improves the explanatory power of the model over the businesscycle, irrespec카드 게임 하기ve of habit forma카드 게임 하기on way. If the distor카드 게임 하기ons associated with external habitare not completely eliminated by the fiscal policy, then the remaining external habit entailsa gap between the private marginal rate of subs카드 게임 하기tu카드 게임 하기on between consump카드 게임 하기on and labor andthe social marginal rate of subs카드 게임 하기tu카드 게임 하기on, genera카드 게임 하기ng an endogenous trade-off between thestabiliza카드 게임 하기on of welfare-relevant output gap and infla카드 게임 하기on. Under this circumstance,discre카드 게임 하기on, par카드 게임 하기ally taking into account the trade-off between output gap and infla카드 게임 하기on, canbe better than a strict infla카드 게임 하기on targe카드 게임 하기ng rule in welfare dimension if the fiscal authoritydoes not implement any tax policy to eliminate the distor카드 게임 하기ons associated with external habit.The monetary policy to deal with distor카드 게임 하기ons associated with external habit is less effec카드 게임 하기ve inthe ra카드 게임 하기o external habit model than in the difference habit model, resul카드 게임 하기ng in a higher theinfla카드 게임 하기on rate in the ra카드 게임 하기o external habit model than the infla카드 게임 하기on rate in the difference habitmodel.