Fiscal Policy under Indeterminacy and Tax Evasion

Francesco Busato, Bruno Chiarini and Enrico Marchetti

Economics Working Papers from Department of Economics and Business Economics, Aarhus University

Abstract: This paper shows under indeterminacy and tax evasion, an increase in corporate, labor or income tax rates pushes the economy into an expansionary pattern. These effects are reversed when the steady state is saddle-path stable.

Keywords: Dynamic General Equilibrium Models; Fiscal Policy; Tax Evasion (search for similar items in EconPapers)
JEL-codes: E13 E26 E32 O40 (search for similar items in EconPapers)
Pages: 22
Date: 2005-05-30
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:aah:aarhec:2005-09

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