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Alesina Drazen (1991) - Why Are Stabilizations Delayed (view source)
Revision as of 16:46, 4 November 2011
, 16:46, 4 November 2011→The Model
Taxes before stabilization are therefore:
:<math>\underbrace{\tau(t) }_{\mbox{Taxes}} = \overbrace{\gamma}^{\mbox{Taxed %}}\times\underbrace{(rb(t) +g_o)}_{\mbox{Total expenditures}}\,</math>
:<math>\therefore \tau(t) = \gamma r \bar{b}^{(1-\gamma)rt}\,</math>
