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Fiscal Impulse during the 2008 Crisis

Author

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  • Baranov, Igor N.
  • Castro, P. C.
  • Micic, D.
  • Salgado, G. B.

Abstract

The design of optimal policy responses to global capital market turmoil has been the source of intensive debate. This debate has now assumed a different perspective after the world financial crisis of 2008. In the aftermath of the crisis, the adoption of activist "fiscal stimulus" in order to combat the risk of increasing recession and unemployment has been thoroughly advocated. This paper uses a simplified version of the empirical methodology developed by Ortiz, Ottonello, Sturzenegger and Talvi (2007) to discuss the fiscal policy measures adopted in the aftermath of the 2008 world financial crisis, and tries to find evidence of the adoption of expansionary fiscal policies right after the crisis. Then, it tries to find out what determines the capacity of countries to use fiscal impulse, by using both cross-sectional and panel data analysis.

Suggested Citation

  • Baranov, Igor N. & Castro, P. C. & Micic, D. & Salgado, G. B., 2013. "Fiscal Impulse during the 2008 Crisis," Working Papers 809, Graduate School of Management, St. Petersburg State University.
    • Handle: RePEc:sps:wpaper:809
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    References listed on IDEAS

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    1. Talvi, Ernesto & Vegh, Carlos A., 2005. "Tax base variability and procyclical fiscal policy in developing countries," Journal of Development Economics, Elsevier, vol. 78(1), pages 156-190, October.
    2. Arellano, Cristina & Mendoza, Enrique G., 2002. "Credit Frictions and "Sudden Stop" in Small Open Economies: An Equilibrium Business Cycle Framework for Emerging Markets Crises," IDB Publications (Working Papers) 1440, Inter-American Development Bank.
    3. Ramos Francia Manuel & Cuadra Gabriel & Capistrán Carlos, 2011. "Policy Response to External Shocks: Lessons from the Crisis," Working Papers 2011-14, Banco de México.
    4. Guillermo A. Calvo, 1998. "CAPITAL FLOWS AND CAPITAL-MARKET CRISES: The Simple Economics of Sudden Stops," Journal of Applied Economics, Taylor & Francis Journals, vol. 1(1), pages 35-54, November.
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    Cited by:

    1. Alsufyev, A. & Zavyalova, Elena K., 2013. "Human Resourse Development Practices and Innovations: Problem Overview," Working Papers 800, Graduate School of Management, St. Petersburg State University.

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