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Does government spending crowd in private consumption? . Theory and empirical evidence fro the euro area

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Does government spending crowd in private consumption? : Theory and empirical evidence for the euro area

Coenen, Günter (contributor); Straub, Roland (contributor) - 2005

In this paper, we revisit the effects of government spending shocks on private consumption within an estimated New-Keynesian DSGE model of the euro area featuring non-Ricardian households. Employing Bayesian inference methods, we show that the presence of non-Ricardian households is in general...