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Optimal factor and production subsidies under classical unemployment

Author

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  • Frank Barry

Abstract

This paper appraises and compares the macroeconomic effects of three supply-side policies - namely employment, investment and production subsidies - within the context of a multisectoral two-period model of a small open economy with classical unemployment. Optimal subsidy levels are studied, a hierarchy of policies is derived, and policy rankings are shown to survive the introduction of common alternative specifications of the social welfare function.

Suggested Citation

  • Frank Barry, 1991. "Optimal factor and production subsidies under classical unemployment," Working Papers 199102, School of Economics, University College Dublin.
    • Handle: RePEc:ucn:wpaper:199102
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    File URL: http://hdl.handle.net/10197/1479
    File Function: First version, 1991
    Download Restriction: no
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