The effects of government spending under limited capital mobility /

Saved in:

Bibliographic Details
Author / Creator:	Shen, Wenyi, author.
Imprint:	[Washington, D.C.] : International Monetary Fund, ©2012.
Description:	1 online resource (41 pages) : illustrations.
Language:	English
Series:	IMF working paper ; WP/12/129 IMF working paper ; WP/12/129.
Subject:	Government spending policy -- Developing countries -- Econometric models. Fiscal policy -- Developing countries -- Econometric models. Multiplier (Economics) -- Econometric models. Fiscal policy -- Econometric models. Government spending policy -- Econometric models. Developing countries.
Format:	E-Resource Book
URL for this record:	http://pi.lib.uchicago.edu/1001/cat/bib/12500244

Hidden Bibliographic Details
Other authors / contributors:	Yang, Shu-Chun Susan, 1971- author. International Monetary Fund. Research Department, issuing body.
ISBN:	9781475503661 1475503660
Notes:	Title from PDF title page (IMF Web site, viewed May 30, 2012). "Research Department." "May 2012." Includes bibliographical references.
Summary:	This paper studies the effects of government spending under limited international capital mobility, as featured by most developing countries. While external financing of government debt mitigates the crowding-out effect, it generates real appreciation, which contracts traded output and lowers the fiscal multiplier in the short run. The decline of the multiplier is larger when facing debt-elastic country risk premia. Also, government spending is more expansionary with more home bias in government purchases, more sectoral rigidities, and a less flexible exchange rate. Whether the twin-deficit hypothesis holds depends crucially on the extent to which government deficits are financed externally.

Similar Items