Arbeitspapier

Countercyclical taxation and price dispersion

In this paper, we explore the benefits from a supply-side oriented fiscal tax policy within the framework of a New Keynesian DSGE model. We show that countercyclical tax rules, which are contingent on the observed welfare gap or on the cost-push shock and levied on value added, remarkably reduce the adverse impact of cost-push shocks on welfare. We state that the tax rule establishes a path for the evolution of marginal cost at the firm level that largely prevents built up of price dispersion. We highlight that this tax policy is also effective under a balancedbudget regime. Hence, fiscal policy can disencumber monetary policy in the light of cost-push shocks.

Sprache
Englisch

Erschienen in
Series: W.E.P. - Würzburg Economic Papers ; No. 78

Klassifikation
Wirtschaft
Business Fluctuations; Cycles
Policy Objectives; Policy Designs and Consistency; Policy Coordination
Fiscal Policy
Thema
Countercyclical fiscal policy
welfare costs
nominal rigidities
Antizyklische Finanzpolitik
Soziale Kosten
Wohlfahrtseffekt
Preisspanne
Dynamisches Gleichgewicht
Ungleichgewichtstheorie
Theorie

Ereignis
Geistige Schöpfung
(wer)
Mayer, Eric
Grimm, Oliver
Ereignis
Veröffentlichung
(wer)
University of Würzburg, Department of Economics
(wo)
Würzburg
(wann)
2008

Handle
Letzte Aktualisierung
10.03.2025, 11:43 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Mayer, Eric
  • Grimm, Oliver
  • University of Würzburg, Department of Economics

Entstanden

  • 2008

Ähnliche Objekte (12)