Keynesian multipliers and the cost of public funds under monopolistic competition

Article Abstract:

Macroeconomic models of imperfect competition with Keynesian features were examined. Unlike earlier studies, this recognized non-unitary elasticities between leisure and private consumption, and the impact of product variety on multipliers and welfare. If the preference for diversity effect is established as in Dixit and Stiglitz (1977), the real national income multiplier for a particular increase in real public spending under free entry and exit is greater than under restricted entry and exit firms. Therefore, private consumption is saturated more in the short-term than long-term.

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Fiscal and environmental policy under monopolistic competition

Article Abstract:

Issues related to fiscal and environmental policies in a closed economy with monopolistic competition are investigated. Specifically, the Keynesian aspects of such an economy show that the cost of public funds increases along with the virtual environment tax and the level of market competition. In short, environmental consciousness raises the virtual environmental tax, the cost of public funds and public abatement and leads to lower public goods offerings.

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Taxing energy to improve the environment: efficiency and distributional effects

Article Abstract:

The impact of environmental tax policy is examined using an overlapping generations model.

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