Gray, Jo Anna and Stone, Joe A. (2012): Debt and nonlinear fiscal policy: evidence from the states.
Download (54kB) | Preview
Evidence from a half century of experience by states identifies nonlinearities in the effects of debt and fiscal policy on growth. Effects are Keynesian for low to moderate levels of debt and stimulus but anti Keynesian for sufficiently high levels of debt or stimulus. Results are broadly consistent with models by Barro (1999), Judd (1987), and others.
|Item Type:||MPRA Paper|
|Original Title:||Debt and nonlinear fiscal policy: evidence from the states|
|Keywords:||debt; fiscal policy; nonlinear;growth; Keynes|
|Subjects:||E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, Macroeconomic Policy, and General Outlook > E62 - Fiscal Policy
B - History of Economic Thought, Methodology, and Heterodox Approaches > B2 - History of Economic Thought since 1925 > B22 - Macroeconomics
A - General Economics and Teaching > A1 - General Economics > A10 - General
|Depositing User:||Joe/A. Stone|
|Date Deposited:||28. Jun 2012 20:50|
|Last Modified:||16. Feb 2013 18:33|
Adam, C.S., Beevan, D.L., 2011. Fiscal deficits and growth in developing countries. Cornell/ISPE Conference on Public Finance and Development. ISSN: 1471-0498.
American Council on Intergovernmental Relations, 2006. Archive http://govinfo.library.unt.edu/amcouncil/index.html.
Bania, N., Gray, J.A., Stone, J.A. 2007. Growth, taxes, and government expenditures: growth hills for U.S. states. National Tax Journal 60:2, 193-204.
Barro, R.J., 1999. Government spending in a simple model of endogenous growth. Journal of Political Economy 98:5, S103-26. Judd, K.L., 1987. Debt and distortionary taxation in a simple perfect foresight model. Journal of Monetary Economics 20, 51-72.
Mofidi, A., Stone, J., 1990. Do state and local taxes affect economic growth? Review of Economics and Statistics 72:4, 686-91.
Rogoff, K.S., Reinhart, C.M., 2010. Growth in a time of debt. American Economic Review 100:2, 573-78.
Rogoff, K.S., Reinhart, C.M., 2009. This Time Is Different: Eight Centuries of Financial Folly. Princeton University Press, Princeton, N. J.