This paper explores the quantitative link between export-promoting commercial policies and economic growth. We build and calibrate a dynamic general equilibrium model of a small developing economy. The economy's equilibrium is suboptimal due to monopolistic competition in the manufacturing...

We extend the Hansen and Prescott (1991) method for the numerical computation of equilibria of dynamic business cycle models in which there are two sets of agents who play a dynamic Stackelberg game. Such models have application to analysis of issues of optimal government policy in which the...

We build a simple dynamic model of the business cycle with monopolistically competitive firms. With simple assumptions concerning firm entry and exit, the model can explain some important stylised facts of the business cycle which standard real business cycle models with perfect competition...

Contrasting sharply with a recent trend in DSGE modeling, we propose a business cycle model where frictions and shocks are chosen with parsimony. The model emphasizes a few labor-market frictions and shocks to monetary policy and technology. The model, estimated from U.S. quarterly postwar data,...

We show how to use optimal control theory to derive optimal time-consistent Markov-perfect government policies in nonlinear dynamic general equilibrium models, extending the result of Cohen and Michel (1988) for models with quadratic objective functions and linear dynamics. We replace private...

An estimated dynamic general equilibrium model which features imperfectly competititve households, sticky nominal wages and costly labor input adjustment is shown to be consistent with several stylized aspects of U.S. postwar business cycle dynamics including the positive serial correlation of...

We examine the dual role of labor adjustment costs and staggered wage contracts as endogenous propagation mechanisms. We show that a dynamic general equilibrium model which combines these two features explains the autocorrelation functions of output growth and nominal wage growth, as well as the...

We consider the effects of fiscal spending shocks in a real business model when a portion of government spending is endogenized and chosen to maximize the utility of the representative private agent. Endogenous spending partially neutralizes the effects of both exogenous fiscal spending shocks...

The paper analyzes optimal fiscal policy in an overlapping generations model with two-period lived households. The government must choose tax rates and borrowing to finance an exogenous stream of expenditures. It cannot commit to future policies, so announced policies that are not time...

Dans cet article, nous présentons un survol de la littérature macroéconomique sur la taxation optimale. En premier lieu, nous présentons un modèle très simple à agent représentatif afin de démontrer le résultat principal de cette littérature concernant le taux de taxation sur le...