Kühn, Stefan; Muysken, Joan; Veen, Tom van - Maastricht : METEOR, Maastricht Research School of … - 2009
Empirical evidence shows that government spending crowds in private consumption, a Keynesian phenomenon. The current state of the art, New Keynesian models based on optimising households and _rms, is not able to predict such a result. We show with a graphical framework as well as a formal model...