 Fiscal Policy Multipliers: The Role of Monopolistic Competition, Scale Economies, and Intertemporal Substitution in Labour SupplyBen Heijdra () International Economic Review, 1998, vol. 39, issue 3, 659-96 Abstract: A dynamic macroeconomic model of monopolistic competition is developed for the closed economy. Forward looking consumers demand differentiated goods, supply labor, and save part of their income in the form of shares. Producers manufacture the differentiated goods by using labor and capital. The author studies the short-run, transition, and long-run effects of fiscal policy. Comparisons with the New Classical case of perfect competition are made. Simple expressions for multipliers are derived. The sensitivity of the multipliers for diversity preference and Ethier productivity effects, intratemporal and intertemporal substitution effects, and markup effects under free and restricted entry are also studied. Copyright 1998 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association. Date: 1998 There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:ier:iecrev:v:39:y:1998:i:3:p:659-96 Ordering information: This journal article can be ordered from Access Statistics for this article International Economic Review is currently edited by Harold L. Cole More articles in International Economic Review from Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association 160 McNeil Building, 3718 Locust Walk, Philadelphia, PA 19104-6297. Contact information at EDIRC. |
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