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¡Ú¥¿¥¤¥È¥ë¡Û:The effect of different expenditure financing in the money-in-production-function model (with Daisuke Matsuzaki).
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we examine the effects of the diffrene financing (an increase in the income tax rate and an increase in the nominal money growth rate) in the model where real money balances is an input in the production process. In contrast to the result in Palivos and Yip (1995) which examines the effects of the alternative financing under cash-in-advance constraints on consumption purchases and investment purchase, we show that the decrease in the growth rate is less under income tax financing than under money financing. Furthermore, we compare the welfare under each regime. We find that money financing is always more harmful to the welfare than income tax financing.

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