Essays in applied macroeconomics

Viac o knihe

This doctoral thesis examines the macroeconomic effects of government policies across three areas. The first part focuses on fiscal policy, analyzing government spending's composition and its impact on key macroeconomic variables. Using calibrated and estimated DSGE models, the research distinguishes between productive and unproductive spending, revealing that the composition of government expenditure influences both short-run behavior and long-run growth. The models account for two production sectors, highlighting how government demand can stimulate one sector while crowding out another. In the second part, the thesis shifts to monetary policy, exploring whether central banks should consider house price trends. A New Keynesian DSGE model incorporating housing and banking sectors assesses the implications of central bank responses to house price inflation. Findings indicate that a lack of reaction to rising house prices leads to greater price increases and housing sector expansion, while a proactive response may result in lower economic growth or even contraction. The final section investigates structural macroeconomic policies, specifically the role of financial and educational institutions in shaping income and inequality. An overlapping generations model with heterogeneous agents shows that improved educational institutions enhance individual income and reduce inequality, whereas better financial institutions promote grow