The speed of convergence and alternative government financing

✍ Scribed by Yoichi Gokan

• Book ID: 104293313
• Publisher: Elsevier Science
• Year: 2003
• Tongue: English
• Weight: 146 KB
• Volume: 27
• Category: Article
• ISSN: 0165-1889
• DOI: 10.1016/s0165-1889(02)00068-4

✦ Synopsis

In this paper we are concerned with the speed of convergence in the Sidrauski monetary optimizing model (Sidrauski, Am. Econ. Rev. 57 (1967) 534), in which the steady-state capital stock is not in uenced by a change in public spending. The paper studies how di erent the speed of convergence to the steady state is a ected by a change in government spending under the various ways of ÿnancing. In exploring the transitional adjustment to the public policy shock, it will be convenient to focus upon the degree of relative risk averse.