The Endogenization of Government Behaviour in Macroeconomic Models /
The purpose of this book is to discuss the issues involved in and to make a contribution to the endogenization of public sector behaviour in macroeconomic models. To that end, the traditional theory of economic policy is critically reviewed as well as the existing literature on the impact of politic...
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| Format: | eBook |
| Language: | English |
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Berlin, Heidelberg :
Springer Berlin Heidelberg,
1989.
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| Series: | Studies in contemporary economics.
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| Subjects: | |
| Online Access: | Connect to the full text of this electronic book |
| Summary: | The purpose of this book is to discuss the issues involved in and to make a contribution to the endogenization of public sector behaviour in macroeconomic models. To that end, the traditional theory of economic policy is critically reviewed as well as the existing literature on the impact of politics on (macro)economic policy. It is argued that Van Windens' interest function approach offers a more useful and valuable entry to the analysis of public sector decision making. It gives a coherent, yet condensed picture of the impact of the various social classes on economic policy. Using this approach an explanatory model of public sector decision making is developed, which yields behavioural equations for public expenditure, public employment and taxation that appear to be suited for insertion in a macroeconomic model. Application of the model to data for the Netherlands shows that the model can be provided with empirical support and that the power structure of society can be proxied by the relative numerical strengths of the economically active social classes. Taking the latter finding for granted, a fully closed model of politico-economic interaction is obtained. The model is further generalized to account explicitly for the social security system and its income transfers, and to allow for multi-period decision making on bond financed budget deficits/surpluses. |
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| Item Description: | Electronic resource. |
| Physical Description: | 1 online resource (xi, 367 pages 12 illustrations) |
| ISBN: | 9783642745911 (electronic bk.) 3642745911 (electronic bk.) |
| ISSN: | 1431-8806 |