The Effects of Current Fiscal Restraint on the Australian Economy: an Applied General Equilibrium Analysis with Imperfect Competition

[img]
Preview
op-91.pdf - Published Version (126kB) | Preview
Available under license: Creative Commons Attribution

Abayasiri-Silva, Kaludura and Horridge, Mark ORCID: 0000-0002-1070-5763 (1999) The Effects of Current Fiscal Restraint on the Australian Economy: an Applied General Equilibrium Analysis with Imperfect Competition. Working Paper. Centre of Policy Studies (CoPS).

Abstract

The objective of this paper is to examine the short run and long run effects of the reduction of government expenditure on the Australian economy using an applied general equilibrium model, which incorporates economies of scale and imperfect competition. The paper describes a 23-sector computable general equilibrium model of the Australian economy, and covers short-run as well as long-run profit-maximising behaviour of the firm. Economies of scale are incorporated in the model at the industry level and the firm level. The pricing behaviour is modelled as perfectly competitive, monopolistically competitive and in other ad hoc ways, as in Harris (1984). The different assumptions about technology, pricing behaviour and firm entry are combined in various ways to produce a variety of scenarios in our simulations. We present results for three different types of non-competitive regime and compare these with results generated by a traditional version of the same model.

Additional Information

CoPS/IMPACT Working Paper Number OP-91

Item type Monograph (Working Paper)
URI https://vuir.vu.edu.au/id/eprint/29308
Official URL http://www.copsmodels.com/elecpapr/op-91.htm
ISBN 0732615127
Subjects Historical > FOR Classification > 1402 Applied Economics
Current > Division/Research > Centre of Policy Studies (CoPS)
Keywords C68; L11; L13; AGE model; economies of scale; fiscal policy; government expenditure; production technology; pricing behaviour; market structure; monopolistically competitive
Download/View statistics View download statistics for this item

Search Google Scholar

Repository staff login