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Tax structure, optimal fiscal policy, and the business cycle

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  • Jang-Ting Guo
  • Kevin J. Lansing

Abstract

The development of a real business cycle model in which government fiscal variables such as tax rates and public expenditures are endogenous. The authors characterize the \"optimal\" behavior of these policy variables over the business cycle and relate this behavior to movements in private-sector variables like output, consumption, labor hours, and investment.

Suggested Citation

  • Jang-Ting Guo & Kevin J. Lansing, 1994. "Tax structure, optimal fiscal policy, and the business cycle," Economic Review, Federal Reserve Bank of Cleveland, vol. 30(Q IV), pages 2-14.
    • Handle: RePEc:fip:fedcer:y:1994:i:qiv:p:2-14:n:v.30no.4
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    References listed on IDEAS

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    17. Kevin J. Lansing, 1994. "Optimal fiscal policy when public capital is productive: a business- cycle perspective," Working Papers (Old Series) 9406, Federal Reserve Bank of Cleveland.
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    22. Chamley, Christophe, 1985. "Efficient Taxation in a Stylized Model of Intertemporal General Equilibrium," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 26(2), pages 451-468, June.
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    Cited by:

    1. Jones, John Bailey, 2002. "Has fiscal policy helped stabilize the postwar U.S. economy?," Journal of Monetary Economics, Elsevier, vol. 49(4), pages 709-746, May.

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