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Anticipation, learning and welfare : the case of distortionary taxation
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dc.contributor.author | Gasteiger, Emanuel | |
dc.contributor.author | Zhang, Shoujian | |
dc.date.accessioned | 2013-09-27T11:01:02Z | |
dc.date.available | 2013-09-27T11:01:02Z | |
dc.date.issued | 2013-08-26 | |
dc.identifier.citation | Gasteiger , E & Zhang , S 2013 ' Anticipation, learning and welfare : the case of distortionary taxation ' School of Economics & Finance Discussion Paper 1309 , no. 1309 , University of St Andrews . | en |
dc.identifier.issn | 0962-4031 | |
dc.identifier.other | PURE: 53047847 | |
dc.identifier.other | PURE UUID: 6819dba2-f12b-4527-925d-f07c8e188dde | |
dc.identifier.uri | https://hdl.handle.net/10023/4067 | |
dc.description | Revise and resubmit in Journal of Economic Dynamics and Control | en |
dc.description.abstract | We study the impact of anticipated fiscal policy changes in a Ramsey economy where agents form long-horizon expectations using adaptive learning. We ex- tend the existing framework by introducing distortionary taxes as well as elastic labour supply, which makes agents' decisions non-predetermined but more realistic. We detect that the dynamic responses to anticipated tax changes under learning have oscillatory behaviour that can be interpreted as self-ful lling waves of optimism and pessimism emerging from systematic forecast errors. Moreover, we demonstrate that these waves can have important implications for the welfare consequences of fiscal reforms. | |
dc.format.extent | 32 | |
dc.language.iso | eng | |
dc.publisher | University of St Andrews | |
dc.relation.ispartofseries | School of Economics & Finance Discussion Paper 1309 | en |
dc.rights | (c) The authors | en |
dc.subject | Fiscal policy | en |
dc.subject | Adaptive learning | en |
dc.subject | Oscillations | en |
dc.subject | HB Economic Theory | en |
dc.subject.lcc | HB | en |
dc.title | Anticipation, learning and welfare : the case of distortionary taxation | en |
dc.type | Working or discussion paper | en |
dc.description.version | Publisher PDF | en |
dc.contributor.institution | University of St Andrews. School of Economics and Finance | en |
dc.identifier.url | http://ideas.repec.org/p/san/wpecon/1309.html | en |
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