In this note the growth anti welfare effects of fiscal anti monetary policies are investigated in three economies where public investment is part of the productive process It is shown that growth is maximized at positive levels of income tax and inflation but that there is no direct relationship...

Fiscal policy in Latin America has been guided primarily by short-term liquidity targets whose observance was taken as the main exponent of fiscal prudence, with attention focused almost exclusively on the levels of public debt and the cash deficit. Very little attention was paid to the effects...

We study the impact of distortions in the investment goods sector on aggregate total factor productivity (TFP). We develop a two-sector neo- classical growth model in which TFP in the capital goods sector relative to TFP in the consumption sector is inversely related to the price of invest- ment...