Showing 91 - 100 of 107,163
Keynesian theory predicts output responses upon a fiscal expansion in a small open economy to be larger under fixed than floating exchange rates. We analyse the effects of fiscal expansions using a New Keynesian model and find that the reverse holds in the presence of sovereign default risk. By...
Persistent link: https://www.econbiz.de/10011257468
This paper examines the government spending multiplier when economic agents form their expectations based on an adaptive learning scheme. The learning mechanism is such that the agents forecast future values of forward-looking variables using a linear function of an information set that does not...
Persistent link: https://www.econbiz.de/10011083100
We identify government spending news and surprise shocks using a novel identification based on the Survey of Professional Forecasters. News shocks lead to an increase of the interest rate, a real appreciation of US dollar and a worsening of the trade balance. The opposite is found for the...
Persistent link: https://www.econbiz.de/10011083743
I analyze the effects of an increase in government purchases financed entirely through seignorage, in both a classical and a New Keynesian framework, and compare them with those resulting from a more conventional debt-financed stimulus. My findings point to the importance of nominal rigidities...
Persistent link: https://www.econbiz.de/10011084562
This paper studies how the spending side of fiscal policy reacts to the business cycle. I find that between 2000 and 2012, government spending is forward-looking in a number of countries—it reacts to forecasts of economic activity rather than to past economic realizations. I also study...
Persistent link: https://www.econbiz.de/10011183105
Motivated by the high public employment, and the public wage premia observed in Europe, a Real-Business-Cycle model, calibrated to German data (1970-2007), is set up with a richer government spending side, and an endogenous private-public sector labor choice. To illustrate the effects of fiscal...
Persistent link: https://www.econbiz.de/10010896986
We investigate the eects of government spending on U.S. output with a threshold structural vector autoregressive model. We consider Bayesian model comparison and generalized impulse response analysis to test for nonlinearities in the responses of output to government spending. Our empirical...
Persistent link: https://www.econbiz.de/10010900330
This paper examines the quantitative interrelations between sectoral composition of public spending and equilibrium (in)determinacy in a two-sector real business cycle model with positive productive externalities in investment. When government purchases of con- sumption and investment goods are...
Persistent link: https://www.econbiz.de/10010901477
Recent evidence on the effect of government spending shocks on consumption cannot be easily reconciled with existing optimizing business cycle models. We extend the standard New Keynesian model to allow for the presence of rule-of-thumb (non-Ricardian) consumers. We show how the interaction of...
Persistent link: https://www.econbiz.de/10010986424
I analyze the effects of an increase in government purchases financed entirely through seignorage, in both a classical and a New Keynesian framework, and compare them with those resulting from a more conventional debt-financed stimulus. My findings point to the importance of nominal rigidities...
Persistent link: https://www.econbiz.de/10010950610