Publication:
Markov-perfect optimal fiscal policy : the case of unbalanced budgets

Simple item page
dc.affiliation.dptoUC3M. Departamento de EconomĂ­aes
dc.contributor.authorOrtigueira, Salvador
dc.contributor.authorPereira, Joana
dc.contributor.authorPichler, Paul
dc.contributor.editorUniversidad Carlos III de Madrid. Departamento de EconomĂ­a
dc.date.accessioned2012-10-29T17:20:56Z
dc.date.available2012-10-29T17:20:56Z
dc.date.issued2012-10-29
dc.description.abstractWe study optimal time-consistent fiscal policy in a neoclassical economy with endogenous government spending, physical capital and public debt. We show that a dynamic complementarity between the households’ consumption-savings decision and the government’s policy decision gives rise to a multiplicity of expectations-driven Markov-perfect equilibria. The long-run levels of taxes, government spending and debt are not uniquely pinned down by economic fundamentals, but are determined by expectations over current and future policies. Accordingly, economies with identical fundamentals may significantly differ in their levels of public indebtedness
dc.description.sponsorshipThis author is grateful for financial support from the Spanish Ministerio de Ciencia e InnovaciĂłn under grant 2011/00049/001
dc.format.mimetypeapplication/pdf
dc.identifier.issn2340-5031
dc.identifier.repecwe1230
dc.identifier.urihttp://hdl.handle.net/10016/15788
dc.identifier.uxxiDT/0000000832
dc.language.isoeng
dc.relation.ispartofseriesUC3M Working papers. Economics
dc.relation.ispartofseries12-30
dc.rightsAtribución-NoComercial-SinDerivadas 3.0 España
dc.rights.accessRightsopen access
dc.rights.urihttp://creativecommons.org/licenses/by-nc-nd/3.0/es/
dc.subject.ecienciaEconomĂ­a
dc.subject.jelE61
dc.subject.jelE62
dc.subject.jelH21
dc.subject.jelH63
dc.subject.otherOptimal fiscal policy
dc.subject.otherMarkov-perfect equilibrium
dc.subject.otherTime-consistent policy
dc.subject.otherExpectation traps
dc.titleMarkov-perfect optimal fiscal policy : the case of unbalanced budgets
dc.typeworking paper*
dc.type.hasVersionSMUR*
dspace.entity.typePublication
Files
Original bundle
Now showing 1 - 1 of 1
Thumbnail Image
Name:
we1230.pdf
Size:
631.95 KB
Format:
Adobe Portable Document Format
Description:
Download
Collections
DE - Working Papers. Economics. WE
Economists Online