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Built-in Stabilizers

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  • William Scarth

Abstract

Two policies that are intended a s built-in stabilizers are examine d: countercyclical tax adjustments and schemes that increase wage and price flexibility. The analysis involves rational expectations, policy expectations effects, and a short-run Phillips curve whose slope varies with changes in "demand" and "supply" policies. The strongest support for these Keynesian policy proposals comes from that version of the analysis th at most thoroughly involves the analytical methods that have been pioneered by N ew Classicals.

Suggested Citation

  • William Scarth, 1988. "Built-in Stabilizers," Canadian Journal of Economics, Canadian Economics Association, vol. 21(4), pages 747-758, November.
  • Handle: RePEc:cje:issued:v:21:y:1988:i:4:p:747-58
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