Hidden Bibliographic Details
| Other authors / contributors: | International Monetary Fund. Fiscal Affairs Department.
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| ISBN: | 1283513404
9781283513401
9781451985061
1451985061
1462331645
9781462331642
1452790507
9781452790503
9786613825858
6613825859
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| Digital file characteristics: | text file
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| Notes: | Includes bibliographical references.
Restrictions unspecified
Electronic reproduction. [Place of publication not identified] : HathiTrust Digital Library, 2010.
Master and use copy. Digital master created according to Benchmark for Faithful Digital Reproductions of Monographs and Serials, Version 1. Digital Library Federation, December 2002. http://purl.oclc.org/DLF/benchrepro0212
English.
digitized 2010 HathiTrust Digital Library committed to preserve
Print version record.
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| Summary: | This paper continues the study of optimal fiscal policy in a growing economy by exploring a case in which the government simultaneously provides three main categories of expenditures with distortionary tax finance: public production services, public consumption services, and state-contingent redistributive transfers. The paper shows that in a general equilibrium model with given exogenous fiscal policy, a nonlinear relation exists between the suboptimal longrun growth rate in a competitive economy and distortionary tax rates. When fiscal policy is endogenously chosen at a social optimum, the relation between the rate of growth and tax rates is always negative. These two conclusions suggest that the interaction between fiscal policy and growth may be complicated enough that it cannot be captured in a simple linear model using an aggregate measure of fiscal policy. The sources of nonlinearity include expectation and coordination of fiscal policy, impluse response of government policies, and the presence of positive externality due to government spending.
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| Other form: | Print version: Park, Hyun. Expenditure composition and distortionary tax for equitable economic growth. Washington, D.C. : International Monetary Fund, Fiscal Affairs Dept., ©2006
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| Standard no.: | 10.5089/9781451985061.001
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