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Publicação
Euro area time-varying cyclicality of fiscal policy
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Orientador(es)
Resumo(s)
We assess the cyclicality of fiscal policy in the 19 Euro area countries, notably during recessions, for the period 1995-2020. We use a time-varying measure of fiscal cyclicality to describe fiscal policy developments. The results suggest that during recessions discretionary fiscal policy becomes more pro-cyclical, but the overall budget balance becomes more counter- cyclical. Hence, pursuing a Ricardian fiscal regime by more indebted countries leads to higher counter-cyclicality of fiscal policy. Government size reduces counter-cyclicality, as well as trade openness, and financial development has a positive impact on counter-cyclicality.
Descrição
Palavras-chave
Fiscal Policy Cyclicality Time-varying coefficient Euro area
Contexto Educativo
Citação
Afonso, António e Francisco Tiago Carvalho (2021). "Euro area time-varying cyclicality of fiscal policy". Instituto Superior de Economia e Gestão – REM Working paper series nº 0202 – 2021
Editora
ISEG - REM – Research in Economics and Mathematics