Molana, Hassan

Zhang, Junxi

English

In a monopolistic competition macromodel with endogenous market structure, the fiscal multiplier is shown to consist of two components. One component depicts the response of output to a fiscal expansion through the conventional channels that disregard the role of market imperfections and a second one captures the effect of both firms’ market power and the policy induced change in the market structure. The latter effect – which is missing from the existing studies – is shown to be quite crucial in raising the fiscal multiplier even above unity, and also in improving consumers’ welfare when the labour market is competitive

University of Dundee Online Publications

Dundee Discussion Papers in Economics 104:Market structure and fiscal policy effectiveness

A note on taxation, imperfect competition and the balanced budget multiplier,

A simple model of imperfect competition with Walrasian features,

Can imperfect competition explain the difference between primal and dual productivity measures: Estimates for U.S. manufacturing,

Complementarities and cumulative processes in models of monopolistic competition,

Dynamic general equilibrium models with imperfectly competitive product markets. In

Evidence on the substitutability between government purchases and consumer spending within specific spending categories,

Fiscal policy and aggregate demand,

Fiscal policy, distortionary taxation, and direct crowding out under monopolistic competition,

Global behaviour of a system with imperfect private-public substitutability,

Government debt, government spending, and private-sector behaviour; comment,

Government spending and private consumption: some international evidence,

Imperfect competition and the fiscal multiplier,

Imperfect competition and the Keynesian Cross,

Market power, economic profitability and productivity growth measurement: an integrated structural approach,

Monopolistic Competition and the Effects of Aggregate Demand,

Monopolistic competition as a foundation for Keynesian macroeconomic models,

On the mechanics of economic development,

Product diversity, endogenous markups, and development traps,

The market-power foundations of macroeconomic policy,

The new macroeconomics; imperfect competition and policy effectiveness,

The relation between price and marginal cost in U.S. industry: a contradiction,

Useful government expenditure in a simple model of imperfect competition,

https://discovery.dundee.ac.uk/files/106160/DDPE_104.pdf

Dundee Discussion Papers in Economics 104:Market structure and fiscal policy effectiveness

Abstract

Similar works

Full text

Available Versions

University of Dundee Online Publications

University of Dundee Online Publications