This paper uses a one-sector, endogenous growth model to study optimal composition between public investment and consumption in government expenditure and its relationships with economic growth. Assuming a benevolent government which maximizes a representative household’s lifetime utilities,...

The volume collects the essays presented at the 15th Workshop on Public Finance organised by Banca d'Italia in Perugia from 4 to 6 April 2013. The workshop focused on the link between fiscal policy and macroeconomic imbalances and comprised four sessions. The first session concentrated on the...

Standard official measures of economic well-being are based on money income. The general consensus is that such measures are seriously flawed because they ignore several crucial determinants of well-being. We examine two such determinants-household wealth and public consumption-in the context of...

In earlier work we documented two episodes in which a sharp fiscal consolidation was associated with a surprisingly large expansion in private domestic demand. In this paper we draw on further evidence to investigate if and when fiscal policy changes can have such non-Keynesian effects. In the...

Aimed at understanding some of the factors explaining the growth of GDP, in the Portuguese case, to understand the correlation and is degree, on the situation of our sample, we conclude that the general linear model (Manso 1998), despite being fairly simple, is suitable to our purpose. This...

A number of emerging markets have experienced substantial real exchange rate appreciation in recent years, generating concerns about competitiveness and prompting policymakers to respond with a combination of mitigating policies. This paper shows that fiscal policy can play a role in alleviating...

Empirically, the cyclical pattern of fiscal policy differs between developed and developing countries, with in particular much greater pro-cyclicality and volatility of public investment in developing countries. In this paper I provide a theoretical explanation for the observed differences by...

The multiplier effects resulting from an isolated increase in the level of public consumption within different public branches are investigated and the policy implications are discussed. The article begins with a theoretical analysis which shows why and in which ways these multipliers can be...