Topic
Golden Rule (fiscal policy)
About: Golden Rule (fiscal policy) is a research topic. Over the lifetime, 661 publications have been published within this topic receiving 9789 citations.
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TL;DR: In this paper, Gale's theorem on the existence of balanced equilibria in a consumption loan model with many generations was generalized to allow more general preferences, and it was shown that there are plausible conditions under which there exists a Pareto optimal (non-optimal) balanced equilibrium whenever there exists (does not exist) a monetary golden rule equilibrium.
11 citations
TL;DR: In this paper, the implication of a simple class of fiscal rules for long-run economic growth and welfare is examined, motivated by institutional arrangements in countries such as Germany and the UK.
Abstract: In this paper we examine the implication of a simple class of fiscal rules for long-run economic growth and welfare. The Golden Rule of Public Finance that we examine is motivated by institutional arrangements in countries such as Germany and the UK. We find that rules that seek to limit government borrowing to productive investment spending have a clear justification in terms of growth and welfare when government-provided goods are otherwise excessively provided. Even in the case where it is private consumption that is excessive, the Golden Rule of Public Finance is likely to be good from a growth perspective, but the welfare effects are more ambiguous.
11 citations
TL;DR: Moore's Law has been the golden rule of the electronics industry for over 50 years as discussed by the authors, and it has driven innovation that has revolutionized the way the industry produces and consumes information.
Abstract: Moore's Law has been the golden rule of the electronics industry for over 50 years. This law, first published in 1965 by Dr. Gordon Moore [1], has driven innovation that has revolutionized the way ...
11 citations
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TL;DR: In this paper, the authors suggest that making the formulation of the golden rule forward-looking and independent of the dating of the economic cycle would reduce the risk of procyclicality and enhance macroeconomic stability.
Abstract: The present formulation of the golden rule in the United Kingdom allows fiscal performance to be tested explicitly on an ex-post basis. However, it requires precise dating of the economic cycle, which can lead to significant controversy. Also, the need to aim for current balance or better "over the cycle" may force fiscal policy to be procyclical toward the end of cycles. Using dynamic stochastic simulations, the paper suggests that making the formulation of the golden rule forward-looking and independent of the dating of the economic cycle would reduce the risk of procyclicality and enhance macroeconomic stability.
11 citations
TL;DR: In this article, the authors discuss the gains from trade and the changes in the terms of trade, and discuss the open economies following the Golden Rule, and conclude that trade is beneficial for all.
Abstract: I. The gains from trade, 556. II. Changes in the terms of trade, 558. — III. Open economies following the Golden Rule, 559. — IV. Summary, 562.— Appendix, 563.
11 citations