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Results 1-10 of 18 (Search time: 0.003 seconds).
Budget Consolidation : Short-Term Pain and Long-Term Gain
Book/Monograph, Created By Douglas Laxton; Susanna Mursula; Kevin Clinton; Michael Kumhof and Published By INTERNATIONAL MONETARY FUND in ENGLISH language
The paper evaluates the costs and benefits of fiscal consolidation using simulations based on the IMFs global DSGE model GIMF. Over the longer run, well-targeted permanent reductions in budget deficits lead to a considerable increase in both the growth rate and the level of output. The gains may be enhanced by shifting some of the tax burden from incomes to consumption. In the short run, credibility plays a crucial role in determining the size of initial output loses. Global current account imbalances would be significantly reduced if budget conso...
Effects of Fiscal Stimulus in Structural Models
Book/Monograph, Created By Michael Kumhof; Dirk Muir; Carlos de Resende; Jan in t Veld; Ren Lalonde; Davide Furceri; Annabelle Mourougane; John Roberts; Stephen Snudden; Mathias Trabandt; G nter Coenen; Susanna Mursula; Christopher J. Erceg; Charles Freedman; Jesper Lind; Werner Roeger; Douglas Laxton and Published By INTERNATIONAL MONETARY FUND in ENGLISH language
The paper assesses, using seven structural models used heavily by policymaking institutions, the effectiveness of temporary fiscal stimulus. Models can, more easily than empirical studies, account for differences between fiscal instruments, for differences between structural characteristics of the economy, and for monetary-fiscal policy interactions. Findings are: (i) There is substantial agreement across models on the sizes of fiscal multipliers. (ii) The sizes of spending and targeted transfers multipliers are large. (iii) Fiscal policy is most effective if it has some persistence...
The Global Integrated Monetary and Fiscal Model (GIMF) Theoretical Structure
Book/Monograph, Created By Douglas Laxton; Susanna Mursula; Michael Kumhof; Dirk Muir and Published By INTERNATIONAL MONETARY FUND in ENGLISH language
This working paper presents a comprehensive overview of the theoretical structure of the Global Integrated Monetary and Fiscal Model (GIMF), a multi-region dynamic general equilibrium model that is used by the IMF for a variety of tasks including policy analysis, risk analysis, and surveillance.
The Global Integrated Monetary and Fiscal Model (GIMF) Theoretical Structure
Book/Monograph, Created By Douglas Laxton; Susanna Mursula; Michael Kumhof; Dirk Muir and Published By INTERNATIONAL MONETARY FUND in ENGLISH language
This working paper presents a comprehensive overview of the theoretical structure of the Global Integrated Monetary and Fiscal Model (GIMF), a multi-region dynamic general equilibrium model that is used by the IMF for a variety of tasks including policy analysis, risk analysis, and surveillance.
Effects of Fiscal Stimulus in Structural Models
Book/Monograph, Created By Michael Kumhof; Dirk Muir; Carlos de Resende; Jan in t Veld; Ren Lalonde; Davide Furceri; Annabelle Mourougane; John Roberts; Stephen Snudden; Mathias Trabandt; G nter Coenen; Susanna Mursula; Christopher J. Erceg; Charles Freedman; Jesper Lind; Werner Roeger; Douglas Laxton and Published By INTERNATIONAL MONETARY FUND in ENGLISH language
The paper assesses, using seven structural models used heavily by policymaking institutions, the effectiveness of temporary fiscal stimulus. Models can, more easily than empirical studies, account for differences between fiscal instruments, for differences between structural characteristics of the economy, and for monetary-fiscal policy interactions. Findings are: (i) There is substantial agreement across models on the sizes of fiscal multipliers. (ii) The sizes of spending and targeted transfers multipliers are large. (iii) Fiscal policy is most effective if it has some persistence...
Jointly Optimal Monetary and Fiscal Policy Rules under Borrowing Constraints
Book/Monograph, Created By Michael Kumhof; Huixin Bi and Published By INTERNATIONAL MONETARY FUND in ENGLISH language
We study the welfare properties of an economy where both monetary and fiscal policy follow simple rules, and where a subset of agents is borrowing constrained. The optimized fiscal rule is far more aggressive than automatic stabilizers, and stabilizes the income of borrowingconstrained agents, rather than output. The optimized monetary rule features super-inertia and a very low coefficient on inflation, which minimizes real wage volatility. The welfare gains of optimizing the fiscal rule are far larger than the welfare gains of optimizing the monetary rule. The&...
Fiscal Stimulus to the Rescue? Short-Run Benefits and Potential Long-Run Costs of Fiscal Deficits :
Book/Monograph, Created By Douglas Laxton; Dirk Muir; Michael Kumhof; Susanna Mursula; Charles Freedman and Published By INTERNATIONAL MONETARY FUND in ENGLISH language
This paper uses the IMF's Global Integrated Monetary and Fiscal Model to compute shortrun multipliers of fiscal stimulus measures and long-run crowding-out effects of higher debt. Multipliers of two-year stimulus range from 0.2 to 2.2 depending on the fiscal instrument, the extent of monetary accommodation and the presence of a financial accelerator mechanism. A permanent 0.5 percentage point increase in the U.S. deficit to GDP ratio raises the U.S. tax burden and world real interest rates in the long run, thereby reducing U.S. and rest of the worl...
Fiscal Stimulus to the Rescue? Short-Run Benefits and Potential Long-Run Costs of Fiscal Deficits
Book/Monograph, Created By Douglas Laxton; Dirk Muir; Michael Kumhof; Susanna Mursula; Charles Freedman and Published By INTERNATIONAL MONETARY FUND in ENGLISH language
This paper uses the IMF's Global Integrated Monetary and Fiscal Model to compute shortrun multipliers of fiscal stimulus measures and long-run crowding-out effects of higher debt. Multipliers of two-year stimulus range from 0.2 to 2.2 depending on the fiscal instrument, the extent of monetary accommodation and the presence of a financial accelerator mechanism. A permanent 0.5 percentage point increase in the U.S. deficit to GDP ratio raises the U.S. tax burden and world real interest rates in the long run, thereby reducing U.S. and rest of the worl...
Fiscal Deficits and Current Account Deficits
Book/Monograph, Created By Michael Kumhof; Douglas Laxton and Published By INTERNATIONAL MONETARY FUND in ENGLISH language
The effectiveness of recent fiscal stimulus packages significantly depends on the assumption of non-Ricardian savings behavior. We show that, under the same assumption, fiscal deficits can have worrisome implications if they turn out to be permanent. First, if they occur in large countries they significantly raise the world real interest rate. Second, they cause a short run current account deterioration equal to around 50 percent of the fiscal deficit deterioration. Third, the longer run current account deterioration equals almost 75 percent for a large economy ...
Fiscal Deficits and Current Account Deficits
Book/Monograph, Created By Michael Kumhof; Douglas Laxton and Published By INTERNATIONAL MONETARY FUND in ENGLISH language
The effectiveness of recent fiscal stimulus packages significantly depends on the assumption of non-Ricardian savings behavior. We show that, under the same assumption, fiscal deficits can have worrisome implications if they turn out to be permanent. First, if they occur in large countries they significantly raise the world real interest rate. Second, they cause a short run current account deterioration equal to around 50 percent of the fiscal deficit deterioration. Third, the longer run current account deterioration equals almost 75 percent for a large economy ...