The Fiscal Multiplier in Small Open Economy is popular PDF and ePub book, written by Jasmin Sin in 2016-07-12, it is a fantastic choice for those who relish reading online the Business & Economics genre. Let's immerse ourselves in this engaging Business & Economics book by exploring the summary and details provided below. Remember, The Fiscal Multiplier in Small Open Economy can be Read Online from any device for your convenience.
The Fiscal Multiplier in Small Open Economy Book PDF Summary
This paper studies the fiscal multiplier using a small-open-economy DSGE model enriched with financial frictions. It shows that the multiplier is large when frictions are present in domestic and international financial markets. The reason is that in the model government bonds are more liquid than private financial assets and that entrepreneurs face liquidity constraints. A bond-financed fiscal expansion eases these constraints and stimulates investment and hence growth. This mechanism, however, breaks down under the assumption of perfect international capital mobility, suggesting that conventional models which ignore the presence of frictions in international capital markets tend to underestimate the fiscal multiplier.
Detail Book of The Fiscal Multiplier in Small Open Economy PDF
- Author : Jasmin Sin
- Release : 12 July 2016
- Publisher : International Monetary Fund
- ISBN : 9781498366298
- Genre : Business & Economics
- Total Page : 34 pages
- Language : English
- PDF File Size : 8,7 Mb
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