This setting lets you change the way you view articles. You can choose to have articles open in a dialog window, a new tab, or directly in the same window.
Open in Dialog
Open in New Tab
Open in same window

American Economic Review: Vol. 89 No. 5 (December 1999)

Expand

Quick Tools:

Print Article Summary
Export Citation
Sign up for Email Alerts Follow us on Twitter

Explore:

AER - All Issues

AER Forthcoming Articles

On the Size of U.S. Government: Political Economy in the Neoclassical Growth Model

Article Citation

Krusell, Per, and Jose-Victor Rios-Rull. 1999. "On the Size of U.S. Government: Political Economy in the Neoclassical Growth Model." American Economic Review, 89(5): 1156-1181.

DOI: 10.1257/aer.89.5.1156

Abstract

We study a dynamic version of Meltzer and Richard's median-voter model of the size of government. Taxes are proportional to total income, and they are redistributed as equal lump-sum transfers. Voting takes place periodically over time, and each consumer votes for the tax rate that maximizes his equilibrium utility. We calibrate the model to U.S. data. Key elements in the calibration are the income and wealth distribution and the parameters governing the leisure and consumption choices. The total size of transfers predicted by our political-economy model is quite close to the size of transfers in the data.

Article Full-Text Access

Full-text Article

Authors

Krusell, Per (U Rochester Inst for Int'l Econ Studies, and CEPR)
Rios-Rull, Jose-Victor (U PA and NBER)

JEL Classifications

H11: Structure, Scope, and Performance of Government
O41: One, Two, and Multisector Growth Models
P16: Capitalist Systems: Political Economy


American Economic Review


Quick Tools:

Sign up for Email Alerts

Follow us on Twitter

Subscription Information
(Institutional Administrator Access)

Explore:

AER - All Issues

AER - Forthcoming Articles

Virtual Field Journals


AEA Member Login:


AEAweb | AEA Journals | Contact Us