Fiscal policy under imperfect competition: A survey

Luis Costa and Huw Dixon

No 2010-14, Economics Discussion Papers from Kiel Institute for the World Economy (IfW Kiel)

Abstract: This paper surveys the link between imperfect competition and the effects of fiscal policy on output, employment and welfare. We examine static and dynamic models, with and without entry under a variety of assumptions using a common analytical framework. We find that in general there is a robust relationship between the fiscal multiplier and welfare, the tantalizing possibility of Pareto improving fiscal policy is much more elusive. In general, the mechanisms are supply side, and so welfare improving policy, whilst possible, is not a general result.

Keywords: Fiscal policy; imperfect competition (search for similar items in EconPapers)
JEL-codes: E62 (search for similar items in EconPapers)
Date: 2010
New Economics Papers: this item is included in nep-cba and nep-mac
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http://www.economics-ejournal.org/economics/discussionpapers/2010-14
https://www.econstor.eu/bitstream/10419/30326/1/623840774.pdf (application/pdf)

Related works:
Working Paper: Fiscal Policy under Imperfect Competition: A Survey (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifwedp:201014

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