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. The basic framework considers an economy with a large informal production sector and a heterogeneous work force. The labor … improves competitiveness, and expands the formal sector at the expense of the informal sector. Hence, in a two-sector economy …
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We provide a comprehensive account of the dynamics of eurozone countries from 2000 to 2012. We analyze private leverage, fiscal policy, labor costs and interest rates and we propose a strategy to separate the impact of credit cycles, excessive government spending, and sudden stops. We then ask...
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) Fiscal stimulus or “helicopter drops of money” are powerful and, indeed, pull the economy out of the zero lower bound. More …
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control inflation and influence the economy in the usual ways. The paper discusses models of fiscal limits and their … implications and lays out a research agenda to integrate political economy and empirical considerations with general equilibrium …
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