The effect of the consumption tax on economic growth and welfare with money and endogenous fertility

Akihiko Kaneko; Daisuke Matsuzaki

The effect of the consumption tax on economic growth and welfare with money and endogenous fertility

Akihiko Kaneko, Daisuke Matsuzaki^*

^*Corresponding author for this work

School of Political Science and Economics

Research output: Contribution to journal › Article › peer-review

1 Citation (Scopus)

Abstract

In this study, we examine the effect of consumption tax on the growth rate and welfare in a model with money and endogenous fertility. First, we show that an increase in consumption tax always reduces the economic growth rate but has an ambiguous effect on welfare. We show a numerical example based on Japanese data and demonstrate the likelihood that increasing the consumption tax decreases welfare. We also compare the effects of consumption tax financing and monetary financing on growth rate and welfare.

Original language	English
Pages (from-to)	355-375
Number of pages	21
Journal	Seoul Journal of Economics
Volume	31
Issue number	4
Publication status	Published - 2018

Keywords

Consumption tax
Endogenous fertility
Endogenous growth
Money-in-the-utility-function model

ASJC Scopus subject areas

Economics, Econometrics and Finance(all)

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

Cite this

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title = "The effect of the consumption tax on economic growth and welfare with money and endogenous fertility",

abstract = "In this study, we examine the effect of consumption tax on the growth rate and welfare in a model with money and endogenous fertility. First, we show that an increase in consumption tax always reduces the economic growth rate but has an ambiguous effect on welfare. We show a numerical example based on Japanese data and demonstrate the likelihood that increasing the consumption tax decreases welfare. We also compare the effects of consumption tax financing and monetary financing on growth rate and welfare.",

keywords = "Consumption tax, Endogenous fertility, Endogenous growth, Money-in-the-utility-function model",

author = "Akihiko Kaneko and Daisuke Matsuzaki",

note = "Funding Information: The authors wish to thank the participants of the 25th Pacific Conference of the RSAI in Taiwan. This work was supported in part by a Waseda University Grant for Special Research Projects [No. 2017K-012] (Akihiko Kaneko); JSPS KAKENHI Grant Numbers No. JP17K03727 (Akihiko Kaneko), and No. JP16K03664 (Daisuke Matsuzaki). The authors are solely responsible for any errors. Publisher Copyright: {\textcopyright} 2018, Seoul National University,Institute of Economic Research.",

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T1 - The effect of the consumption tax on economic growth and welfare with money and endogenous fertility

AU - Kaneko, Akihiko

AU - Matsuzaki, Daisuke

N1 - Funding Information: The authors wish to thank the participants of the 25th Pacific Conference of the RSAI in Taiwan. This work was supported in part by a Waseda University Grant for Special Research Projects [No. 2017K-012] (Akihiko Kaneko); JSPS KAKENHI Grant Numbers No. JP17K03727 (Akihiko Kaneko), and No. JP16K03664 (Daisuke Matsuzaki). The authors are solely responsible for any errors. Publisher Copyright: © 2018, Seoul National University,Institute of Economic Research.

PY - 2018

Y1 - 2018

N2 - In this study, we examine the effect of consumption tax on the growth rate and welfare in a model with money and endogenous fertility. First, we show that an increase in consumption tax always reduces the economic growth rate but has an ambiguous effect on welfare. We show a numerical example based on Japanese data and demonstrate the likelihood that increasing the consumption tax decreases welfare. We also compare the effects of consumption tax financing and monetary financing on growth rate and welfare.

AB - In this study, we examine the effect of consumption tax on the growth rate and welfare in a model with money and endogenous fertility. First, we show that an increase in consumption tax always reduces the economic growth rate but has an ambiguous effect on welfare. We show a numerical example based on Japanese data and demonstrate the likelihood that increasing the consumption tax decreases welfare. We also compare the effects of consumption tax financing and monetary financing on growth rate and welfare.

KW - Consumption tax

KW - Endogenous fertility

KW - Endogenous growth

KW - Money-in-the-utility-function model

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The effect of the consumption tax on economic growth and welfare with money and endogenous fertility

Abstract

Keywords

ASJC Scopus subject areas

UN SDGs

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