01802cas a2200265 a 4500 AALejournalIMF006700 230101c9999 xx r poo 0 0eng d 5.00 USD 9781455205295 1018-5941 BD-DhAAL BD-DhAAL Kumhof, Michael. To Starve or Not to Starve the Beast? / Michael Kumhof, Daniel Leigh, Douglas Laxton. Washington, D.C. : International Monetary Fund, 2010. 1 online resource (36 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students For thirty years prominent voices have advocated a policy of starving the beast cutting taxes to force government spending cuts. This paper analyzes the macroeconomic and welfare consequences of this policy using a two-country general equilibrium model. Under several strong assumptions the policy, if fully implemented, produces domestic output and welfare gains accompanied by losses elsewhere. But negative effects can easily arise in the presence of longer policy implementation lags, utility-enhancing government spending, and productive government capital. Overall, the analysis finds no support for the idea that starving the beast is a foolproof way towards higher output and welfare. Mode of access: Internet Laxton, Douglas. Leigh, Daniel. IMF Working Papers; Working Paper ; No. 2010/199 Full text available on IMF http://elibrary.imf.org/view/journals/001/2010/199/001.2010.issue-199-en.xml IMF e-Library