HOME BIAS IN GOVERNMENT SPENDING AND QUASI NEUTRALITY OF FISCAL SHOCKS

Giovanni Ganelli

Macroeconomic Dynamics, 2005, vol. 9, issue 2, 288-294

Abstract: We show how introducing home bias in government spending in the redux model generates quasi neutrality of fiscal policy shocks. We offer an intuitive explanation for this result and we stress its policy implications.

Date: 2005
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Persistent link: https://EconPapers.repec.org/RePEc:cup:macdyn:v:9:y:2005:i:02:p:288-294_04

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