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The Political Economy of Fiscal Consolidations

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  • Roberto Perotti

Abstract

In the context of recent research in political economy, this paper addresses the policy problem of fiscal consolidation in terms of three types of issues: i) the macroeconomic effects of alternative strategies to consolidate; ii) the institutional setups conducive to a consolidation; and iii) the best strategy for implementing a consolidation in order to maximize its political feasibility. One methodological feature of this survey is an emphasis on policy feasibility. One methodological feature of this survey is an emphasis on policy issues in order to bridge the gap between the level of abstraction of politico‐economic models of fiscal policy and the issues faced by a policymaker when attempting a fiscal consolidation.

Suggested Citation

  • Roberto Perotti, 1998. "The Political Economy of Fiscal Consolidations," Scandinavian Journal of Economics, Wiley Blackwell, vol. 100(1), pages 367-394, March.
    • Handle: RePEc:bla:scandj:v:100:y:1998:i:1:p:367-394
    DOI: 10.1111/1467-9442.00107
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