On the effectiveness and limits of fiscal stabilizers
Abstract
The smoothing impact of fiscal stabilizers (proxied by government expenditures) on business cycle volatility is studied for a panel of European Union (EU) countries in the period 1970-1999. Special emphasis is put on the investigation of possible nonlinearities in the relationship between Gross Domestic Product (GDP) growth volatility and fiscal stabilizers. The results show that the business cycle volatility smoothing effect of fiscal stabilizers may revert at high levels. The results hold when using government revenues as a proxy for fiscal stabilizers.Download Info
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Bibliographic Info
Article provided by Taylor and Francis Journals in its journal Applied Economics.
Volume (Year): 43 (2009)
Issue (Month): 9 ()
Pages: 1079-1086
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Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Maria-Grazia Attinasi & Cristina Checherita-Westphal & Malte Rieth, 2011. "Personal income tax progressivity and output volatility: evidence from OECD countries," Working Paper Series 1380, European Central Bank.
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