Full metadata record
DC Field | Value | Language |
---|---|---|
dc.contributor.author | Ferriere, Axelle | - |
dc.contributor.author | Navarro, Gaston | - |
dc.date.accessioned | 2014-02-13T18:57:35Z | - |
dc.date.available | 2014-02-13T18:57:35Z | - |
dc.date.issued | 2014-02-13 | - |
dc.identifier.uri | http://hdl.handle.net/2451/33558 | - |
dc.description.abstract | Empirical work suggests that while government spending induces an increase in output, it does not signi ficantly decrease private consumption. Contrary to these fi ndings, most representative-household models in macroeconomics predict a crowding-out of private consumption by government spending. To address this issue, we develop a model with heterogeneous households and uninsurable idiosyncratic risk as in Aiyagari (1994). In a model with heterogeneous households, progressivity of taxes is a key determinant of the eff ects of government spending. A rise in government spending can be expansionary, both for output and consumption, if financed with more progressive labor taxes. However, it is contractionary if financed with less progressive taxes. With a narrative approach, we use large changes in military spending to provide evidence that government spending in the United States has been expansionary only in periods of increasing progressivity. | en_US |
dc.language.iso | en_US | en_US |
dc.rights | Copyright Axelle Ferriere and Gaston Navarro, February 2014. | en_US |
dc.subject | Fiscal Stimulus, Government Spending, Multiplier | en_US |
dc.subject | Transfers, Heterogeneous Agents | en_US |
dc.title | The Heterogeneous Effects of Government Spending: It's All About Taxes | en_US |
dc.type | Working Paper | en_US |
dc.authorid-ssrn | 1133565 | en_US |
dc.paperid-ssrn | EC-13-18 | en_US |
Appears in Collections: | Economics Working Papers |
Files in This Item:
File | Description | Size | Format | |
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FerriereNavarro_HeterogenGovtSpending_Feb2014.pdf | 531.2 kB | Adobe PDF | View/Open |
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