Author : Daehaeng Kim
Publisher : International Monetary Fund
ISBN 13 :
Total Pages : 40 pages
Book Rating : 4.:/5 (318 download)
Book Synopsis Government Size and Intersectoral Income Fluctuation by : Daehaeng Kim
Download or read book Government Size and Intersectoral Income Fluctuation written by Daehaeng Kim and published by International Monetary Fund. This book was released on 2007-04 with total page 40 pages. Available in PDF, EPUB and Kindle. Book excerpt: Using the between-sector variation in income as a new measure of economic uncertainty, this paper proposes simple models and supportive empirical evidence for the causal relations between economic uncertainty and government size in the open economy setting. Key empirical findings include: (1) a larger government reduces economic uncertainty, and, at the same time, (2) an economy facing higher uncertainty has a larger government. However, (3) the government tends to resort to redistributive policies to reduce the uncertainty, while (4) government direct spending is also an effective option for the purpose. The study also finds that (5) cross-sectional measure of economic uncertainty tends to rise when a country becomes more open to international trade.