Government efficiency plays a significant role in the relationship between government expenditure and economic growth. Based on panel data from 63 developing countries 1990 to 2003, we calculate efficiency scores using Data Envelopment Analysis, incorporate them into a simple model of growth...

We construct an endogenous growth model with productive public capital and government debt, in which government debt is gradually adjusted to the target level. We examine how the governmentfs debt reductions affect the transitional dynamics and welfare of the economy. We show that fiscal...

We construct an endogenous growth model with productive public capital and government debts where government debts are gradually adjusted to target level. We examine how debt-reductions of the government affect the transitional dynamics and welfare of the economy. Fiscal consolidation has...

This paper analyzes the determinants of government debt and social security for the old in a closed-economy, overlapping-generation model. Under the probabilistic voting, the model presents (i) an intergenerational link of resource allocation via debt and social security; (ii) multiple political...

We construct an endogenous growth model with productive public capital and government debt when government debt is adjusted to the target level. We examine how reducing public debt in an economy with a large public debt affects the transition of the economy and welfare. We find that the...

We construct a small open economy model of endogenous growth with public capital accumulation and examine how a debt policy rule under which the government gradually reduces its debt-GDP ratio to a target level affects macroeconomic stability, fiscal sustainability, and welfare. We obtain the...

This paper develops an overlapping-generations model with nominal wage rigidities and examines the welfare effects of debt policy during recessions. Issues of public debt stimulate aggregate consumption demand and create employment. Future generations then face both increased wage incomes and...

The purpose of this paper is to develop an experimental model which links inter-institutional flow of funds to real macroeconomy and then to estimate quantitatively the effects of changing scale of postal savings or government financial institutions on GDP. The empirical analysis indicates that...

This study presents a two-period overlapping-generations model featuring en- dogenous growth and intergenerational conflict over fiscal policy. In particular, we characterize a Markov-perfect political equilibrium of the voting game between gen- erations, and show the following results. First,...

This paper develops a two-period overlapping-generations model featuring en- dogenous growth and intergenerational conflict over fiscal policy. In particular, the paper characterizes a Markov-perfect political equilibrium of the voting game be- tween generations, and shows the following results....