Ghiglino, Christian and Shell, Karl (2003) The economic effects of restrictions on government budget deficits: imperfect private credit markets. [["eprint_typename_scholarly-edition" not defined]]
Ghiglino, Christian and Shell, Karl (2003) The economic effects of restrictions on government budget deficits: imperfect private credit markets. [["eprint_typename_scholarly-edition" not defined]]
Ghiglino, Christian and Shell, Karl (2003) The economic effects of restrictions on government budget deficits: imperfect private credit markets. [["eprint_typename_scholarly-edition" not defined]]
Abstract
The present paper is an extension of Ghiglino and Shell to the case of imperfect consumer credit markets. We show that with constraints on individual credit and only anonymous (i.e., non-personalized) lump-sum taxes, strong (or "global") irrelevance of government budget deficits is not possible, and weak (or "local") irrelevance can hold only in very special situations. This is in sharp contrast to the result for perfect credit markets. With credit constraints and anonymous consumption taxes, weak irrelevance holds if the number of tax instruments is sufficiently large and at least one consumer's credit constraint is not binding. This is an extension of the result for perfect credit markets.
Item Type: | ["eprint_typename_scholarly-edition" not defined] |
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Uncontrolled Keywords: | balanced-budget amendment; consumption taxes; credit constraints; government budget deficit irrelevance; lump-sum taxes; overlapping generations |
Subjects: | H Social Sciences > HB Economic Theory |
Divisions: | Faculty of Social Sciences Faculty of Social Sciences > Economics, Department of |
SWORD Depositor: | Unnamed user with email elements@essex.ac.uk |
Depositing User: | Unnamed user with email elements@essex.ac.uk |
Date Deposited: | 16 Jul 2012 19:11 |
Last Modified: | 30 Oct 2024 20:34 |
URI: | http://repository.essex.ac.uk/id/eprint/3015 |