Private and Public Consumption and Counter-Ciclical Fiscal Policy

Marattin, Luigi (2007) Private and Public Consumption and Counter-Ciclical Fiscal Policy. Bologna: Dipartimento di Scienze economiche DSE, p. 29. DOI 10.6092/unibo/amsacta/4696. In: Quaderni - Working Paper DSE (588). ISSN 2282-6483.
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Abstract

In this paper we set up a NK-DSGE model in which the consumer derives utility from a consumption basket made of public and private consumption, there is monopolistic competiton in the intermediate good sector, Calvo-Yun price setting, endogenous labour supply and Taylor rule for monetary policy. We analyse the effects of a counterciclical fiscal policy rule and how varying the degree of counterciclicality affects the determinacy of the rational expectations equilbrium and the ability to respond to technological and government spending shocks. A broad conclusion is that desiderability of pro/counter ciclical stance of fiscal policy cannot accurately be drawn without taking into account the quality of the public expenditure and the way it interacts with private consumption.

Abstract
Document type
Monograph (Working Paper)
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CreatorsAffiliationORCID
Marattin, Luigi
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ISSN
2282-6483
DOI
Deposit date
26 Feb 2016 12:31
Last modified
26 Feb 2016 12:31
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