Welfare Effects of Tax Policy in Open Economies - Assignment Point
Welfare Effects of Tax Policy in Open Economies
Subject: Economics | Topics:

Many economists have argued that fiscal policy is not effective for stabilization purposes. However, fiscal policy can be effectively used for stabilization under some circumstances. An example is monetary union such as the European Union where stabilizing monetary policy is not available for regional shocks. In order to properly use active fiscal policy rules under these circumstances, it is important to obtain accurate welfare implications of fiscal policies.

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