A life-cycle overlapping-generations model of the small open economy
AbstractWe construct an overlapping generations model for the small open economy incorporating a realistic description of the mortality process. With age-dependent mortality, the typical life-cycle pattern of consumption and saving results from the maximizing behaviour of individual households. Our 'Blanchard-Yaari-Modigliani' model is used to analytically study a number of typical shocks affecting the small open economy, namely a balanced-budget public spending shock, a temporary Ricardian tax cut, and an interest rate shock. The demographic details matter a lot—both the impulse-response functions and the welfare profiles (associated with the different shocks) are critically affected by them. These demographic details furthermore do not wash out in the aggregate. The model is flexible and can be applied to a wide variety of theoretical and policy issues. Copyright 2008 , Oxford University Press.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Oxford University Press in its journal Oxford Economic Papers.
Volume (Year): 60 (2008)
Issue (Month): 1 (January)
Contact details of provider:
Postal: Oxford University Press, Great Clarendon Street, Oxford OX2 6DP, UK
Fax: 01865 267 985
Web page: http://oep.oupjournals.org/
Other versions of this item:
- Heijdra, Ben J. & Romp, Ward E., 2005. "A Life-Cycle Overlapping-Generations Model of the Small Open Economy," Research Report 05C04, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Heijdra, Ben J., 2009. "Foundations of Modern Macroeconomics," OUP Catalogue, Oxford University Press, edition 2, number 9780199210695.
- Buiter, Willem H, 1988. "Death, Birth, Productivity Growth and Debt Neutrality," Economic Journal, Royal Economic Society, vol. 98(391), pages 279-93, June.
- Leon Bettendorf & Ben Heijdra, 2001. "Intergenerational and International Welfare Leakages of a Product Subsidy in a Small Open Economy," International Tax and Public Finance, Springer, vol. 8(5), pages 705-729, November.
- Lans Bovenberg, A., 1993.
"Investment-promoting policies in open economies : The importance of intergenerational and international distributional effects,"
Journal of Public Economics,
Elsevier, vol. 51(1), pages 3-54, May.
- Bovenberg, A.L., 1993. "Investment-promoting policies in open economies: The importance of intergenerational and international distributional effects," Open Access publications from Tilburg University urn:nbn:nl:ui:12-152980, Tilburg University.
- Bovenberg, A.L., 1992. "Investment-promoting policies in open economies: The importance of intergenerational and international distributional effects," Discussion Paper 1992-20, Tilburg University, Center for Economic Research.
- Bovenberg, A.L., 1992. "Investment-Promoting Policies in Open Economies: The Importance of Intergenerational and International Distributional Effects," Papers 9220, Tilburg - Center for Economic Research.
- Hamid Faruqee & Douglas Laxton, 2000. "Life-Cycles, Dynasties, Savings: Implications for Closed and Small, Open Economies," IMF Working Papers 00/126, International Monetary Fund.
- Heijdra, Ben J. & Meijdam, Lex, 2002. "Public investment and intergenerational distribution," Journal of Economic Dynamics and Control, Elsevier, vol. 26(5), pages 707-735, May.
- Hamid Faruqee, 2003.
"Debt, Deficits, and Age-specific Mortality,"
Review of Economic Dynamics,
Elsevier for the Society for Economic Dynamics, vol. 6(2), pages 300-312, April.
- Heijdra, Ben J. & Horst, Albert van der & Meijdam, Lex, 2002. "Public investment and intergenerational distribution under alternative modes of financing," Research Report 02C51, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
- Leon Bettendorf & Ben Heijdra, 2001. "Intergenerational welfare effects of a tariff under monopolistic competition," Journal of Economics, Springer, vol. 73(3), pages 313-346, October.
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page. reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Oxford University Press) or (Christopher F. Baum).
If references are entirely missing, you can add them using this form.