政府政策與內生波動

Abstract

Some externalities and fiscal policies are examined based on macroeconomic stability in a two-sector growing economy. The concept of aggregate instability is the idea of indeterminacy or sunspot equilibrium. Meanwhile, the preconditions for indeterminacy are explored and compared to those in existing literature. We find that regardless of the nature of public goods, earmarked tax contributes to aggregate stabilization, while general fund financing may be destabilizing. Moreover, sufficiently large congestion effect along with productive public spending is a channel to exert aggregate instability. Finally, our preconditions for indeterminacy are independent of particular factor intensity comparison and under a wide range of the time preference rates and the intertemporal elasticity of substitution. Thus, intersectoral externalities are more robust and easier to establish indeterminacy than sector-specific externalities.