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Nonrenewable Resources: A Case for Persistent Fiscal Surpluses

SSRN Electronic Journal
1999
  • 0
    Citations
  • 2,842
    Usage
  • 0
    Captures
  • 0
    Mentions
  • 0
    Social Media
Metric Options:   Counts1 Year3 Year

Metrics Details

  • Usage
    2,842
    • Abstract Views
      2,700
    • Downloads
      142
  • Ratings
    • Download Rank
      410,895

Article Description

This paper examines whether there is a case for temporary but persistent fiscal surpluses in economies heavily endowed with nonrenewable resources. It finds that there generally is a case. Fiscal surpluses permit replacing nonfinancial wealth with financial assets, the return on which increases public consumption possibilities of future generations for a constant across-generation tax burden. The more biased are a government`s preferences toward present generations, the lower will be the initial surpluses; the larger the finite endowment, the larger the initial surpluses. In a more general framework, including public investment, the proposition could be rephrased by replacing surpluses with stronger initial fiscal positions.

Bibliographic Details

Max Alier; Martin Kaufman

Elsevier BV

Fiscal policy; nonrenewable resources; intergenerational transfer; overlapping generation model; Chile

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