Table 2: Behavioural and public policy parameters.

Parameter Notation Value Consumer preferences Intertemporal elasticity of substitution 0.90 Intratemporal elasticity of substitution 0.80 Production technology Production share of physical capital 0.30 Elasticity of substitution for labour demand 1.50 Depreciation rate of physical capital 0.05 (per year) Interest rate 0.04 (per year) Human capital technology Elasticity of time input 0.70 Elasticity of public spending input 0.18 Public policy CPP/QPP replacement rate 0.20 RPP replacement rate 0.02–0.14 Government expenditures/GDP 0.37 Earned income tax rate 0.31 Capital income tax rate 0.38 Consumption tax rate 0.10