Formulating a fiscal reaction function for ADAM

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2015

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Ambaw, D.
Knudsen, D.

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Dessie Tarko Ambaw, Dan Knudsen

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We attempt to clarify the formation of interest income and examine the role of a fiscal reaction function in ADAM in keeping the public debt from exploding when there is 1% increase in the public purchase of goods and services and the VAT rate. The paper briefly demonstrates the effectiveness of the proposed fiscal rule in stabilizing the public budget.

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Working paper 28.1.15

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You are free to re-use and reproduce contents from dst.dk and statbank.dk. This includes even commercial use. You should, however, always include a source accreditation to Statistics Denmark.

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