کد مقاله | کد نشریه | سال انتشار | مقاله انگلیسی | نسخه تمام متن |
---|---|---|---|---|
5055310 | 1371488 | 2012 | 5 صفحه PDF | دانلود رایگان |
![عکس صفحه اول مقاله: Public debt in a basic endogenous growth model Public debt in a basic endogenous growth model](/preview/png/5055310.png)
We work out the mechanism that makes public debt affect the allocation of resources in the long-run. To do so we analyze an AK growth model with elastic labor supply and a government sector. The government levies a distortionary income tax and issues bonds to finance lump-sum transfers and non-distortionary public spending. We show that the long-run growth rate is the smaller the higher the debt ratio if the government adjusts public spending to fulfill its inter-temporal budget constraint. If the government adjusts lump-sum transfers the public debt ratio does not affect the balanced growth rate.
⺠A basic endogenous growth model with public debt is analyzed. ⺠The income tax rate is fixed and public spending is unproductive and non-distortionary. ⺠If public spending is adjusted, a higher debt ratio reduces long-run growth. ⺠If public transfers are adjusted, public debt does not affect long-run growth.
Journal: Economic Modelling - Volume 29, Issue 4, July 2012, Pages 1344-1348