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Government Spending in a Monetary Model of Endogenous Growth: a Note

Author

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  • Stefano Bosi

    (EPEE, Université d’Evry)

Abstract

Few endogenous growth models are able to encompass unbalanced transitional dynamics. In Barro (1990) public spending is a productive externality and growth is only regular. The second best tax rate equals the public spending return. We provide a monetary version of Barro (1990), where short-run fluctuations are due to money and long-run effects to technology. Barro rule is found to be surprisingly robust within transition.

Suggested Citation

  • Stefano Bosi, 2000. "Government Spending in a Monetary Model of Endogenous Growth: a Note," Documents de recherche 00-11, Centre d'Études des Politiques Économiques (EPEE), Université d'Evry Val d'Essonne.
    • Handle: RePEc:eve:wpaper:00-11
    as

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    References listed on IDEAS

    as
    1. Gene M. Grossman & Elhanan Helpman, 1994. "Endogenous Innovation in the Theory of Growth," Journal of Economic Perspectives, American Economic Association, vol. 8(1), pages 23-44, Winter.
    2. Jean-Guillaume Sahuc, 2002. "Influence of Parameter Estimation Uncertainty on the European Central Banker Behavior: An Extension," Documents de recherche 02-18, Centre d'Études des Politiques Économiques (EPEE), Université d'Evry Val d'Essonne.
    3. Robert J. Barro & Paul Romer, 1993. "Economic Growth (1992)," NBER Books, National Bureau of Economic Research, Inc, number barr93-1, June.
    4. Barro, Robert J, 1990. "Government Spending in a Simple Model of Endogenous Growth," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 103-126, October.
    5. Cazzavillan, Guido, 1996. "Public Spending, Endogenous Growth, and Endogenous Fluctuations," Journal of Economic Theory, Elsevier, vol. 71(2), pages 394-415, November.
    6. Larry E. Jones & Rodolfo Manuelli, 1990. "A Convex Model of Equilibrium Growth," NBER Working Papers 3241, National Bureau of Economic Research, Inc.
    7. Jones, Larry E & Manuelli, Rodolfo E, 1990. "A Convex Model of Equilibrium Growth: Theory and Policy Implications," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 1008-1038, October.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    cash-in-advance; endogenous growth; indeterminacy;
    All these keywords.

    JEL classification:

    • D90 - Microeconomics - - Micro-Based Behavioral Economics - - - General
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General

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