Financial Management White Papers
Temporary Partial Expensing in a General-Equilibrium Model
Overview In recent years, the use of forward-looking general-equilibrium models to analyze the conduct of monetary policy has become a commonplace of the macroeconomics literature. By contrast, considerably less progress has been made in employing these models to examine questions related to fiscal policy. This paper incorporates a nominal tax system into an otherwise standard sticky-price monetary business cycle (MBC) model, and uses the resulting framework to examine the effect of a temporary partial expensing allowance on investment expenditures, real activity, and government revenues.
| Publisher | Federal Reserve Board | File Format | |
|---|---|---|---|
| Date Published | April 2005 | Downloads | 6 |
| Format | White Papers | ||
| Topics | |||
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