Contractionary effects of expansionary fiscal policy: theory and tests

Autor:	Pekka Ahtiala, Antti J. Kanto
Rok vydání:	2002
Předmět:	Economics and Econometrics Empirical research Economics Demand for money Open economy Monetary economics Income elasticity of demand Crowding out Fiscal policy
Zdroj:	Economic Modelling. 19:137-152
ISSN:	0264-9993
DOI:	10.1016/s0264-9993(00)00067-5
Popis:	This paper extends the theoretical work of Ahtiala [Eur. Econ. Rev. (1989) 1481] and examines whether the conditions for fiscal expansion to have a contractionary effect on output are met in Canada. A consistent open economy money-demand function yields an income elasticity of the demand for money greater than unity, leading to the theoretical prediction that this is indeed the case. Study of three episodes and an empirical test lend support to the prediction. The United States is predicted to have the conventional response.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::9baef3c1517604ae6e4e1898288d0087 https://doi.org/10.1016/s0264-9993(00)00067-5 Zobrazit plný text záznamu Full Text from ScienceDirect