Suppose that temporary increases in government spending lead to permanent increases in total factor productivity, perhaps because

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Suppose that temporary increases in government spending lead to permanent increases in total factor productivity, perhaps because some government spending improves infrastructure and makes private firms more productive. Show that temporary shocks to government spending of this type could lead to business cycles that are consistent with the key business cycle facts, and explain your results.

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Macroeconomics

ISBN: 978-0132991339

5th edition

Authors: Stephen d. Williamson

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