Fixed Costs, The Balanced Budget Multiplier And Welfare
In a two-sector model, where one of the sectors is monopolistically competitive and subject to increasing returns to scale but without love for variety, we analyze the effects of a balanced budget fiscal expansion. Such an expansion could increase the welfare of the representative individual, if elasticities of substitution in production and consumption are low. A reorganization of production takes place--increasing returns enabling a rise in real income.
(This abstract was borrowed from another version of this item.)
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.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 60 (2009)
Issue (Month): 3 ()
|Contact details of provider:|| Web page: http://www.blackwellpublishing.com/journal.asp?ref=1352-4739|
More information through EDIRC
|Order Information:||Web: http://www.blackwellpublishing.com/subs.asp?ref=1352-4739|
References listed on IDEAS
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.:
- Cooper, Russell & John, Andrew, 1988. "Coordinating Coordination Failures in Keynesian Models," The Quarterly Journal of Economics, MIT Press, vol. 103(3), pages 441-63, August.
- Hornstein, Andreas, 1993. "Monopolistic competition, increasing returns to scale, and the importance of productivity shocks," Journal of Monetary Economics, Elsevier, vol. 31(3), pages 299-316, June.
- Dixon, Huw, 1987. "A Simple Model of Imperfect Competition with Walrasian Features," Oxford Economic Papers, Oxford University Press, vol. 39(1), pages 134-60, March.
- Sen, Partha, 2002.
"Welfare-improving debt policy under monopolistic competition,"
Journal of Economic Dynamics and Control,
Elsevier, vol. 27(1), pages 143-156, November.
- Partha Sen, . "Welfare-Improving Debt Policy under Monopolistic Competition," EPRU Working Paper Series 94-07, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.
- Jordi Galí, 1993.
"Monopolistic competition, business cycles and the composition of aggregate demand,"
Economics Working Papers
45, Department of Economics and Business, Universitat Pompeu Fabra.
- Gali Jordi, 1994. "Monopolistic Competition, Business Cycles, and the Composition of Aggregate Demand," Journal of Economic Theory, Elsevier, vol. 63(1), pages 73-96, June.
- Gali, J., 1991. "Monopolistic Competition, Business Cycles and the Composition of Aggregate Demand," Papers 92-03, Columbia - Graduate School of Business.
- Weil, Philippe, 1989.
"Increasing Returns and Animal Spirits,"
American Economic Review,
American Economic Association, vol. 79(4), pages 889-94, September.
- Heijdra, Ben J & van der Ploeg, Frederick, 1996. "Keynesian Multipliers and the Cost of Public Funds under Monopolistic Competition," Economic Journal, Royal Economic Society, vol. 106(438), pages 1284-96, September.
- Thomas, Charles P, 1995. "The Role of Fiscal Policy in an Incomplete Markets Framework," Review of Economic Studies, Wiley Blackwell, vol. 62(3), pages 449-68, July.
- Ng, Yew-Kwang, 1980. "Macroeconomics with Non-Perfect Competition," Economic Journal, Royal Economic Society, vol. 90(3593), pages 598-610, September.
- Benassy, Jean-Pascal, 1996. "Taste for variety and optimum production patterns in monopolistic competition," Economics Letters, Elsevier, vol. 52(1), pages 41-47, July.
- Marta Aloi & Huw D. Dixon, 2002.
"Entry Dynamics, Capacity Utilisation and Productivity in a Dynamic Open Economy,"
CESifo Working Paper Series
716, CESifo Group Munich.
- Marta Aloi & Huw Dixon, . "Entry Dynamics, Capacity Utilisation and Productivity in a Dynamic Open Economy," Discussion Papers 02/05, Department of Economics, University of York.
- Mankiw, N. Gregory, 1988.
"Imperfect competition and the Keynesian cross,"
Elsevier, vol. 26(1), pages 7-13.
- Suzumura, Kotaro & Kiyono, Kazuharu, 1987. "Entry Barriers and Economic Welfare," Review of Economic Studies, Wiley Blackwell, vol. 54(1), pages 157-67, January.
- Pagano, Marco, 1989.
"Imperfect Competition, Underemployment Equilibria and Fiscal Policy,"
CEPR Discussion Papers
280, C.E.P.R. Discussion Papers.
- Pagano, Marco, 1990. "Imperfect Competition, Underemployment Equilibria and Fiscal Policy," Economic Journal, Royal Economic Society, vol. 100(401), pages 440-63, June.
- N. Gregory Mankiw & Michael D. Whinston, 1986. "Free Entry and Social Inefficiency," RAND Journal of Economics, The RAND Corporation, vol. 17(1), pages 48-58, Spring.
- Kiyotaki, Nobuhiro, 1988. "Multiple Expectational Equilibria under Monopolistic Competition," The Quarterly Journal of Economics, MIT Press, vol. 103(4), pages 695-713, November.
- Paul Madden & Esma Gaygisiz, 2002. "Macroeconomic coordination failure under oligempory," Economic Theory, Springer, vol. 20(1), pages 93-112.
- Dixon, Huw David & Rankin, Neil, 1994.
"Imperfect Competition and Macroeconomics: A Survey,"
Oxford Economic Papers,
Oxford University Press, vol. 46(2), pages 171-99, April.
- Dixon, H. & Rankin, N., 1991. "Imperfect Competition and Macroeconomics: a Survey," The Warwick Economics Research Paper Series (TWERPS) 387, University of Warwick, Department of Economics.
- Dixon, Huw David & Rankin, Neil, 1992. "Imperfect Competition and Macroeconomics: A Survey," CEPR Discussion Papers 636, C.E.P.R. Discussion Papers.
- Blanchard, Olivier Jean & Kiyotaki, Nobuhiro, 1987. "Monopolistic Competition and the Effects of Aggregate Demand," American Economic Review, American Economic Association, vol. 77(4), pages 647-66, September.
- Fatas, Antonio, 1997. "Multipliers: imperfect competition or increasing returns to scale?," Economics Letters, Elsevier, vol. 57(2), pages 197-201, December.
- Startz, Richard, 1989. "Monopolistic Competition as a Foundation for Keynesian Macroeconomic Models," The Quarterly Journal of Economics, MIT Press, vol. 104(4), pages 737-52, November.
- Devereux, Michael B & Head, Allen C & Lapham, Beverly J, 1996. "Monopolistic Competition, Increasing Returns, and the Effects of Government Spending," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 28(2), pages 233-54, May.
- Devereux, Michael B & Head, Allen C & Lapham, Beverly J, 2000. " Government Spending and Welfare with Returns to Specialization," Scandinavian Journal of Economics, Wiley Blackwell, vol. 102(4), pages 547-61, December.
When requesting a correction, please mention this item's handle: RePEc:bla:jecrev:v:60:y:2009:i:3:p:395-404. 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: (Wiley-Blackwell Digital Licensing)or (Christopher F. Baum)
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.