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On The Cyclical Bias In Government Spending

Author

Listed:
  • Zvi Hercowitz

    (Tel Aviv University, Bank of Israel)

  • Michel Strawczynski

    (Bank of Israel)

Abstract

First, this paper reports ifndings that the prolonged rise in the spending/output ratio in OECD countries is related to a cyclical bias: countercyclical spending in contractions and procyclical spending in expansions. Then, atfer brielfy discussing the policy implications of the cyclical bias, the paper adresses the recent experience of Israel under the Budget Deficit Reduction Law.

Suggested Citation

  • Zvi Hercowitz & Michel Strawczynski, 1998. "On The Cyclical Bias In Government Spending," Bank of Israel Working Papers 1998.06, Bank of Israel.
    • Handle: RePEc:boi:wpaper:1998.06
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    References listed on IDEAS

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    6. Mark Hallerberg & Jürgen von Hagen, 1999. "Electoral Institutions, Cabinet Negotiations, and Budget Deficits in the European Union," NBER Chapters, in: Fiscal Institutions and Fiscal Performance, pages 209-232, National Bureau of Economic Research, Inc.
    7. Roubini, Nouriel & Sachs, Jeffrey D., 1989. "Political and economic determinants of budget deficits in the industrial democracies," European Economic Review, Elsevier, vol. 33(5), pages 903-933, May.
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    Cited by:

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    2. Ernesto Talvi & Carlos A. Vegh, 2000. "Tax Base Variability and Procyclical Fiscal Policy," NBER Working Papers 7499, National Bureau of Economic Research, Inc.

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