Taxing deficits to restrain government spending and foster capital accumulation

In a dynamic model of fiscal policy, social polarization provokes a deficit bias. Policy advisors have recently proposed that governments running a deficit should be forced to generate additional tax revenue. We show that this deficit taxation reduces the deficit bias as it internalizes the external...

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Bibliographic details
Volume: 2007,26
Main Author: Stähler, Nikolai
Format: Paper
Language: English
Place of publication: Frankfurt a. M Deutsche Bundesbank 2007
published in: Discussion paper Series 1 / Volkswirtschaftliches Forschungszentrum der Deutschen Bundesbank Vol. 2007,26
Data of publication: 2007
Online Access: Fulltext
Database: EconStor
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