The output effect of fiscal consolidations
WebbVon Hagen and Strauch (2001) examinedtheprobabilityofaconsolidationtobeexpenditurebasedandfoundthatasmall output gap, both domestically and internationally, a tight fiscal stance in other countries and a high debt-to-GDP ratio increase the probability of a consolidation episode to be expenditure … WebbEpisodes of fiscal consolidation have short- and medium-term output effects, but here, too, composition matters: fiscal consolidations based on reducing public investment have the largest effect on output, while fiscal consolidations based on revenue mobilization are less harmful than those based on public investment cuts.
The output effect of fiscal consolidations
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WebbThis paper studies the impact of tax-based consolidations on reelection outcomes. Using a granular database of tax-based consolidations for a panel of 10 OECD countries over the last 40 years, we find that tax reforms are politically costly but … Webb1 nov. 2024 · Fiscal consolidations that are initiated in expansions, ... debt via fiscal consolidations have very likely resulted in a higher debt to GDP ratio through their long-term negative impact on output.
WebbThe effect on output growth of EB plans is indistinguishable from zero for about two years and then becomes significantly positive, while TB adjustments lead to deep recessions. The component of aggregate demand which seems to explain these differences in all countries, not only Canada, is investment, which is correlated with investor confidence. WebbIn the short term, the pace of consolidation needs to be balanced with the effects of fiscal retrenchment on growth. The trade-off will depend on the choice of fiscal instrument, the size of the multiplier (which is highly uncertain) and whether monetary policy can offset the adverse demand effect.
Webb28 sep. 2012 · This paper studies whether fiscal corrections cause large output losses. We find that it matters crucially how the fiscal correction ... Alberto F. and Favero, Carlo A. …
WebbSimulation of fiscal plans adopted by 16 OECD countries over a 30-year period supports the hypothesis that the effects of consolidations depend on their design. Fiscal adjustments …
Webb27 dec. 2014 · The Output Effect of Fiscal Consolidations DOI: 10.1016/j.jinteco.2014.11.003 Authors: Alberto Alesina Harvard University Carlo Favero … popup chat window angularWebbSimulation of fiscal plans adopted by 16 OECD countries over a 30-year period. × Close Log In. Log in with Facebook Log in with Google. or. Email. Password. Remember me on this … sharonlea primary school uniformWebbThe output effect of fiscal consolidations Author. Abstract. Fiscal consolidations achieved by means of spending cuts are much less costly in terms of output losses than... … sharonlea primary school fees 2020WebbThis note shows that what matters for the effect of fiscal consolidation on output is not only the level of government debt but also the level of risk that stems from it. The … pop up checkout form in clickfunnelWebbThe large size of the effects points in the direction of self-defeating fiscal consolidations as suggested by DeLong and Summers (2012). Attempts to reduce debt via fiscal consolidations have very likely resulted in a higher debt to GDP ratio through their long-term negative impact on output. Acknowledgements and Disclosures Download Citation sharonlea primary school contact numberWebbSanz (2011) examines the impact of fiscal consolidations on the composition of government expenditure drawing on a sample of 25 OECD countries over the period 1970-2007. sharon leathersWebb14 apr. 2024 · This paper analyzes the effect of time-varying cross-country fiscal policy interaction on output and consumption multipliers in a monetary union. The framework is that of a standard New Keynesian two-country model with distortionary taxes and Markov Switching fiscal regimes. The paper uses a two-state Markov switching process for each … sharon leavy academy of hair and beauty