Public investment, time to build, and the zero lower bound

  title={Public investment, time to build, and the zero lower bound},
  author={Hafedh Bouakez and M. Guillard and Jordan Roulleau-Pasdeloup},
We study the effectiveness of public investment in stimulating an economy stuck in a liquidity trap. We do so in the context of a tractable new-Keynesian economy in which a fraction of government spending increases the stock of public capital subject to a time-to-build constraint. Public investment projects typically entail significant time-to-build delays, which often span several years from approval to completion. We show that this feature implies that the spending multiplier associated with… CONTINUE READING


Publications referenced by this paper.

The composition of government spending and the multiplier at the zero lower bound

  • J. Albertini, A. Poirier, J. Roulleau-Pasdeloup
  • Economics Letters,
  • 2014
Highly Influential
6 Excerpts

Similar Papers

Loading similar papers…