This paper employs a stochastic endogenous growth model with productive government expenditure in a small open economy to analyze the optimal fiscal policy. First, a stochastic model of a small open economy is constru...This paper employs a stochastic endogenous growth model with productive government expenditure in a small open economy to analyze the optimal fiscal policy. First, a stochastic model of a small open economy is constructed. Second, the equilibrium solutions of the representative agent＇s stochastic optimization problem are derived. Third, we obtain the equilibrium solutions of the central planner＇s stochastic optimization problem and the optimal government expenditure policy. Finally, the optimal tax policy is characterized.展开更多
基金This research is supported by the National Natural Science Foundation of China （No. 70271069）.
文摘This paper employs a stochastic endogenous growth model with productive government expenditure in a small open economy to analyze the optimal fiscal policy. First, a stochastic model of a small open economy is constructed. Second, the equilibrium solutions of the representative agent＇s stochastic optimization problem are derived. Third, we obtain the equilibrium solutions of the central planner＇s stochastic optimization problem and the optimal government expenditure policy. Finally, the optimal tax policy is characterized.
