Advanced Search
MyIDEAS: Login

Optimal Fiscal Policy in an Economy Facing Socio-Political Instability

Contents:

Author Info

  • Quan Le

    (Claremont Graduate University)

Registered author(s):

    Abstract

    We present a model of optimal government policy when policies may exacerbate socio-political instability (SPI). We show that the optimal policy that takes into account SPI transforms a standard concave growth model into a model with both a poverty trap and endogenous growth. The predictions of the model are tested by developing three new measures of SPI for a panel of 58 countries. Estimating the optimal government policy from the model reveals strong support for the theory. In particular, we show via simulations that optimal policy causes the economy to expand on a quasi-balanced growth path, with the level of SPI determining whether growth is positive or negative.

    Download Info

    If 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.
    File URL: http://www.claremontmckenna.edu/rdschool/papers/2000-60.pdf
    Download Restriction: no

    Bibliographic Info

    Paper provided by Claremont Colleges in its series Claremont Colleges Working Papers with number 2000-60.

    as in new window
    Length:
    Date of creation: 2000
    Date of revision:
    Handle: RePEc:clm:clmeco:2000-60

    Contact details of provider:
    Postal: 500 E. 9th Street, Claremont, CA 91711
    Phone: (909) 607-3041
    Fax: (909) 621-8249
    Web page: http://www.claremontmckenna.edu/rdschool/papers/
    More information through EDIRC

    Related research

    Keywords: socio-political instability; endogenous growth; public investment; political economy of growth;

    Find related papers by JEL classification:

    This paper has been announced in the following NEP Reports:

    References

    No references listed on IDEAS
    You can help add them by filling out this form.

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:clm:clmeco:2000-60. See general 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: ().

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.