Fiscal Adjustments in OECD Countries: Composition and Macroeconomic Effects
1997; Springer Nature; Volume: 44; Issue: 2 Linguagem: Inglês
10.2307/3867543
ISSN0020-8027
AutoresAlberto Alesina, Roberto Perotti,
Tópico(s)Local Government Finance and Decentralization
ResumoThis paper studies how the composition of fiscal adjustments influences their likelihood of "success," defined as a long lasting deficit reduction, and their macroeconomic consequences.We find that fiscal adjustments which rely primarily on spending cuts on transfers and the government wage bill have a better chance of being successful and are expansionary.On the contrary fiscal adjustments which rely primarily on tax increases and cuts in public investment tend not to last and are contractionary.We discuss alternate explanations for these findings by studying both a full sample of OECD countries and by focusing on three case studies: Denmark, Ireland and Italy.
Referência(s)