Fiscal Policy in a Small Open Economy with Oil Sector and non-Ricardian Agents
In this paper we develop a dynamic stochastic general equilibrium fiscal model for the Colombian economy. The model has three main components: the existence of non-Ricardian households, price and wage rigidities, and a fiscal authority that finances government spending partly with public debt. The model is calibrated to capture the empirical evidence on the macroeconomic effects of government spending and it is used to study the effect of an oil price shock under different fiscal policy rules. Our results show that fiscal multipliers in Colombia are positive in a way consistent with the evidence. Our analysis also shows that a structural fiscal rule delivers a better outcome in terms of macroeconomic volatility relative to a balanced budget rule or a countercyclical fiscal rule.
|Date of creation:||Feb 2013|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: (57-1) 3431111
Fax: (57-1) 2841686
Web page: http://www.banrep.org/publicaciones/pub_borra.htm
More information through EDIRC
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.:
- Colciago, Andrea, 2005.
"Rule of Thumb Consumers Meet Sticky Wages,"
3275, University Library of Munich, Germany, revised 27 Apr 2007.
- Ravn, Morten O & Schmitt-Grohé, Stephanie & Uribe, Martín, 2007.
"Explaining the Effects of Government Spending Shocks on Consumption and the Real Exchange Rate,"
CEPR Discussion Papers
6541, C.E.P.R. Discussion Papers.
- Morten O. Ravn & Stephanie Schmitt-Grohé & Martín Uribe, 2007. "Explaining the Effects of Government Spending Shocks on Consumption and the Real Exchange Rate," NBER Working Papers 13328, National Bureau of Economic Research, Inc.
- Aarón Garavito A. & Ana María Iregui B. & María Teresa Ramírez G., 2012.
"Inversión Extranjera Directa en Colombia: Evolución reciente y marco normativo,"
Borradores de Economia
713, Banco de la Republica de Colombia.
- Aarón Garavito A. & Ana María Iregui & María Teresa Ramírez G., 2012. "Inversión Extranjera Directa en Colombia: Evolución reciente y marco normativo," BORRADORES DE ECONOMIA 009655, BANCO DE LA REPÚBLICA.
- Franz Hamann & Ignacio Lozano & Luis Fernando Mejía, .
"Sobre el impacto macroeconómico de los beneficios tributarios al capital,"
Borradores de Economia
668, Banco de la Republica de Colombia.
- Franz Alonso Hamann Salcedo & Luis Ignacio Lozano Espitia & Luis -Fernando Mejía, 2011. "Sobre el impacto macroeconómico de los beneficios tributarios al capital," BORRADORES DE ECONOMIA 008952, BANCO DE LA REPÚBLICA.
- Ignacio Lozano & Karen Rodríguez, .
"Assessing the Macroeconomic Effects of Fiscal Policy in Colombia,"
Borradores de Economia
552, Banco de la Republica de Colombia.
- Ignacio Lozano & Karen Rodríguez, 2011. "Assessing the macroeconomic effects of fiscal policy in Colombia," Journal of Financial Economic Policy, Emerald Group Publishing, vol. 3(3), pages 206-228, August.
- Leopoldo Fergusson, 2003. "Tributación, Crecimiento Y Bienestar: El Caso Colombiano(1970-1999)," DOCUMENTOS CEDE 003662, UNIVERSIDAD DE LOS ANDES-CEDE.
- Calvo, Guillermo A., 1983. "Staggered prices in a utility-maximizing framework," Journal of Monetary Economics, Elsevier, vol. 12(3), pages 383-398, September.
When requesting a correction, please mention this item's handle: RePEc:bdr:borrec:759. 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: (Clorith Angélica Bahos Olivera)
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.