Towards a Theory of Interregional Fiscal Policy
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In this paper, attention is paid to the development of a simple fiscal policy model which could be used to examine the influence of economic relations between regions on stabilisation policy. While the model embodies institutional assumptions which are appropriate only for regions within a country, these could easily be adapted so as to facilitate study of stabilisation problems within an economic union of separate sovereign states.
KeywordsFiscal Policy Aggregate Demand Regional Income Factor Service Factor Income
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