The neoclassical growth model is extended to include limitations in the forecasting capability of a rational individual, who can predict the future state of the economy only for a short time horizon. Long-term predictions are formulated according to uninformed expectations, relying solely on...

This paper examines the information-related problems associated with the analysis of fiscal policies, an issue recently studied in connection with monetary policies but largely ignored in the literature on budgetary action. We estimate a fiscal policy rule for the EU and OECD countries using...