Further processing options
Fiscal stimulus and skill accumulation over the life cycle
Saved in:
| Authors and Corporations: | |
|---|---|
| Edition: | Last updated: January 30, 2023 |
| Type of Resource: | E-Book |
| Language: | English |
| published: | |
| Series: |
Bank of Canada: Staff working paper ; 2023, 9
|
| Subjects: | |
| Source: | Verbunddaten SWB Lizenzfreie Online-Ressourcen |
| Summary: | Using micro data from the U.S. Consumer Expenditure Survey and Current Population Survey, I document that government spending shocks affect individuals differently over the life cycle. Young households increase their consumption after an expansionary shock while prime-age households reduce it, regardless of their level of income or debt. Productivity and wages increase significantly for young workers. To rationalize these findings, I develop a parsimonious New Keynesian life-cycle model where young agents accumulate skills on the job through a learning-by-doing process. An increase in government spending raises hours worked, which enhances skill accumulation, particularly among young workers who face a steep learning curve. The ensuing increase in the relative labor demand for young workers boosts their wages, thus stimulating their consumption. |
|---|---|
| Physical Description: | 1 Online-Ressource (circa 71 Seiten); Illustrationen |
| DOI: | 10.34989/swp-2023-9 |