Resource title

Rent-seeking competition from State coffers : a calibrated DSGE model of the Euro area

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Resource description

This paper incorporates an uncoordinated struggle for extra fiscal favors into an otherwise standard Dynamic Stochastic General Equilibrium model. This reflects the popular belief that interest groups compete for privileged transfers and tax treatment at the expense of the general public interest, and so the aggregate economy stagnates. The model is calibrated to the euro area over the period 1980-2003. Our results show that rent-seeking competition can contribute to explaining the European macroeconomic experience. We also get quantitative evidence of the fraction of collected tax revenues grabbed by rent seekers.

Resource author

Konstantinos Angelopoulos, Apostolis Philippopoulos, Vanghelis Vassilatos

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Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/19108

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Adapt according to the presented license agreement and reference the original author.