This paper examines the cross-border effects of domestic fiscal shocks on foreign economic activities by constructing a two-country general equilibrium model. The model yields two main results by comparing four alternative fiscal shocks: government spending, the capital income tax rate, the labor income tax rate, and the consumption tax rate. First, domestic fiscal shocks can generate sizable spillovers abroad. Second, once the size of each fiscal shock is normalized to achieve an equal change in government revenue, the spillover effects of different fiscal shocks on the foreign economic variables are qualitatively similar.

中文翻译：

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动态两国模型中的财政冲击和溢出

本文通过构建两国一般均衡模型，研究了国内财政冲击对外国经济活动的跨境影响。通过比较四种替代性财政冲击，该模型产生了两个主要结果：政府支出，资本所得税率，劳动所得税率和消费税率。首先，国内的财政冲击会在国外产生可观的溢出效应。其次，一旦将每次财政冲击的规模归一化以实现政府收入的均等变化，不同财政冲击对外国经济变量的溢出效应在质量上是相似的。