Balanced Budget Multiplier with Indirect Taxes Under Imperfect Competition

  1. Torregrosa Montaner, Ramón José
Journal:
Estudios económicos

ISSN: 0186-7202

Year of publication: 2003

Volume: 18

Issue: 1

Pages: 3-13

Type: Article

More publications in: Estudios económicos

Sustainable development goals

Abstract

This paper presents two counter-examples to the Keynesian features attributed to imperfect competition in general equilibrium models. In particular, by considering indirect tax rates, a non possitive and monotonically non-increasing relationship between the magnitude of both the balanced budget and welfare multipliers and market-power is obtained.