This Economic Letter discusses how a deleveraging of the U.S. household sector might affect the growth rate of consumption going forward.

This paper examines the quantitative relationship between the elasticity of capital-labor substitution and the conditions needed for equilibrium indeterminacy (and belief-driven áuctuations) in a one-sector growth model. Our analysis employs a ínormalizedîversion of the CES production...

We compute the growth effects of adopting a revenue-neutral flat tax for both a human capital--based endogenous growth model and a standard neoclassical growth model. Long-run growth effects are decomposed into the parts attributable to the flattening of the marginal tax schedule, the full...

An estimation of an optimal program of distortionary taxes, money growth, and borrowing to finance a stream of expenditures based on a real business cycle model in which distribution issues between the rich and poor play a fundamental role in policy decisions.

A presentation of a dynamic general-equilibrium model with productive public capital to help account for differences in the business cycle characteristics of public- versus private- sector expenditures in postwar U.S. data.

A study of the effects of expectations and central bank credibility on the economy's dynamic transition path during a disinflation. Using a version of the Fuhrer-Moore model, it compares simulations under different specifications that vary according to the way expectations are formed and the...

In light of the severe economic fallout from recent bubble episodes, this Economic Letter examines the potential role of monetary policy in responding to asset prices.