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The fiscal multiplier: positive or negative?

  • Juha Tervala


This study examines whether the fiscal multiplier can be negative for certain types of government spending. The key result is that the fiscal multiplier can be negative if there is a high degree of substitutability between private and government consumption and government consumption is complementary to leisure.

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Paper provided by Aboa Centre for Economics in its series Discussion Papers with number 54.

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Length: 12
Date of creation: Sep 2009
Date of revision:
Handle: RePEc:tkk:dpaper:dp54
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