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A role model for the conduct of fiscal policy? Experiences from Sweden

  • Flodén, Martin

Sweden was hit by a severe macroeconomic crisis in the early 1990s. GDP fell for three consecutive years in 1991–1993, unemployment increased by 9 percentage points, banks had to be nationalized, and public budget deficits exceeded 10 percent of GDP. The recovery was however quick. GDP growth was around four percent in 1994–1995, and budget deficits had been eliminated by 1998. Growth remained high in the subsequent decade, and the government debt ratio was reduced by almost 50 percent of GDP.

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File URL: http://www.sciencedirect.com/science/article/pii/S0261560612001891
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Article provided by Elsevier in its journal Journal of International Money and Finance.

Volume (Year): 34 (2013)
Issue (Month): C ()
Pages: 177-197

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Handle: RePEc:eee:jimfin:v:34:y:2013:i:c:p:177-197
DOI: 10.1016/j.jimonfin.2012.11.010
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/30443

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  1. Ashoka Mody & Stefania Fabrizio, 2006. "Can Budget Institutions Counteract Political Indiscipline?," IMF Working Papers 06/123, International Monetary Fund.
  2. Adam S. Posen, 1995. "Declarations Are Not Enough: Financial Sector Sources of Central Bank Independence," NBER Chapters, in: NBER Macroeconomics Annual 1995, Volume 10, pages 253-274 National Bureau of Economic Research, Inc.
  3. Lars E. O. Svensson, 2011. "Practical Monetary Policy: Examples from Sweden and the United States," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 42(1 (Spring), pages 289-352.
  4. Lars Calmfors, 2012. "The Swedish Fiscal Policy Council: Watchdog with a Broad Remit," CESifo Working Paper Series 3725, CESifo Group Munich.
  5. Giavazzi, Francesco & Pagano, Marco, 1990. "Can Severe Fiscal Contractions Be Expansionary? Tales of Two Small European Countries," CEPR Discussion Papers 417, C.E.P.R. Discussion Papers.
  6. Lars Calmfors & Simon Wren-Lewis, 2011. "What Should Fiscal Councils Do?," CESifo Working Paper Series 3382, CESifo Group Munich.
  7. Stéphanie Guichard & Mike Kennedy & Eckhard Wurzel & Christophe André, 2007. "What Promotes Fiscal Consolidation: OECD Country Experiences," OECD Economics Department Working Papers 553, OECD Publishing.
  8. Persson, T. & Tabellini, G., 1997. "Political Economics and Macroeconomic Policy," Papers 630, Stockholm - International Economic Studies.
  9. Andrea Pescatori & Daniel Leigh & Jaime Guajardo & Pete Devries, 2011. "A New Action-Based Dataset of Fiscal Consolidation," IMF Working Papers 11/128, International Monetary Fund.
  10. Gösta Ljungman, 2009. "Top-Down Budgeting—An Instrument to Strengthen Budget Management," IMF Working Papers 09/243, International Monetary Fund.
  11. Englund, Peter, 1999. "The Swedish Banking Crisis: Roots and Consequences," Oxford Review of Economic Policy, Oxford University Press, vol. 15(3), pages 80-97, Autumn.
  12. Gösta Ljungman, 2008. "Expenditure Ceilings—A Survey," IMF Working Papers 08/282, International Monetary Fund.
  13. Assar Lindbeck, 1997. "The Swedish Experiment," Journal of Economic Literature, American Economic Association, vol. 35(3), pages 1273-1319, September.
  14. Guiseppe Pisauro, 2001. "Intergovernmental Relations and Fiscal Discipline; Between Commons and Soft Budget Constraints," IMF Working Papers 01/65, International Monetary Fund.
  15. Lars Calmfors, 2012. "Sweden - from Macroeconomic Failure to Macroeconomic Success," CESifo Working Paper Series 3790, CESifo Group Munich.
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