Advanced Search
MyIDEAS: Login to save this paper or follow this series

Fiscal Space in the Euro zone

Contents:

Author Info

  • Frantisek Hajnovic

    ()
    (National Bank of Slovakia, Research Department)

  • Juraj Zeman

    ()
    (National Bank of Slovakia, Research Department)

Registered author(s):

    Abstract

    This paper uses data from 1995 to 2008 to estimate debt limits in the European Union countries derived from the budgetary responses to debt levels before the crisis. Based on work by the IMF (Ostry, 2010), we present our suggested approach and estimate the fiscal reaction functions and the implied critical debt levels of EU governments. Since many countries did not take advantage of the boom years for consolidation, the fiscal space – availability of debt financing – in the euro zone has shrunk, especially in countries where the response to rising debt levels has historically been weak. We conclude by stressing a need for structural changes in budget policy (shifts in the reaction on debt) or risk default in cases where fiscal space was negative or has been squeezed.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.nbs.sk/_img/Documents/PUBLIK/wp_5-2012_Hajnovic_Zeman.pdf
    Our checks indicate that this address may not be valid because: 404 Not Found. If this is indeed the case, please notify ()
    Download Restriction: no

    Bibliographic Info

    Paper provided by Research Department, National Bank of Slovakia in its series Working and Discussion Papers with number WP 5/2012.

    as in new window
    Length: 27 pages
    Date of creation: Dec 2012
    Date of revision:
    Handle: RePEc:svk:wpaper:1020

    Contact details of provider:
    Postal: Imricha Karvasa 1, 813 25 Bratislava
    Phone: ++421/2/5787 1111
    Fax: ++421/2/6787 1100
    Email:
    Web page: http://www.nbs.sk/en/publications-issued-by-the-nbs/working-papers
    More information through EDIRC

    Related research

    Keywords: fiscal space; fiscal policy; public debt; consolidation; critical debt level; EU;

    Find related papers by JEL classification:

    This paper has been announced in the following NEP Reports:

    References

    No references listed on IDEAS
    You can help add them by filling out this form.

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:svk:wpaper:1020. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.