The changing structure of goverment consumption spending
Alessio Moro and
No 1840, Working Papers from Banco de España, Working Papers Homepage
We document a secular increase in the share of purchases from the private sector in government consumption spending: over time the government purchases relatively more private-sector goods, and relies less on its own production of value added. We build a general equilibrium model in which investment-specifi c technological change accounts for the changing structure of government spending. The model predicts that this secular process alters the transmission of government spending shocks by raising the response of private value added, while dampening the response of hours. We validate these results with novel empirical evidence on the effects of government spending across countries.
Keywords: government gross output; government wage bill; fi scal multiplier (search for similar items in EconPapers)
JEL-codes: E62 H10 O41 (search for similar items in EconPapers)
Pages: 64 pages
New Economics Papers: this item is included in nep-dge and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed
Downloads: (external link)
https://www.bde.es/f/webbde/SES/Secciones/Publicac ... 18/Files/dt1840e.pdf First version, November 2018 (application/pdf)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:bde:wpaper:1840
Access Statistics for this paper
More papers in Working Papers from Banco de España, Working Papers Homepage Contact information at EDIRC.
Bibliographic data for series maintained by María Beiro. Electronic Dissemination of Information Unit. Research Department. Banco de España ().