Munich Personal RePEc Archive

Income Transfer as Model of Economic Growth

Costa Junior, Celso Jose and Sampaio, Armando Vaz and Gonçalves, Flávio de Oliveria (2012): Income Transfer as Model of Economic Growth. Published in: Revista Economia & Tecnologia , Vol. 8, (2012): pp. 17-32.

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Abstract

This work aims to study the main Brazilian economic growth influenced by an income transfer program. For this purpose, we used the DSGE approach. The estimation of the parameters was performed using the Bayesian methodology and analysis of results was done by impulse response functions. The basic characteristic of this paper is to use two types of consumers: ricardian individuals and non-ricardian individuals. The first agents maximize intertemporally its utility function, while the second type of agents is limited to consume the amount received through income transfer. The results show that implantation this program brings positive returns for the whole economy, except for individuals ricardian.

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