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Fiscal multipliers in Romania

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  • Voinescu Ioan-Vlad

Abstract

Using various methods for identifying the econometric model, I estimated the impact and cumulative fiscal multipliers in order to measure the effects of fiscal policy to the real economy. The results come in line with the economic theory and the studies in this field, as, Romania’s economy being relatively small, open and with a flexible exchange policy, one cannot expect multipliers to be significant in size. Thus, we can conclude that, based on all the methods applied for calculating fiscal multipliers, they will have low values, even if sometimes the impact multipliers tend to have relatively higher values, these values being determined by a higher initial amplitude, but which is not transferred to the real economy, and is followed by a rapid decrease in their magnitude.

Suggested Citation

  • Voinescu Ioan-Vlad, 2018. "Fiscal multipliers in Romania," The Review of Finance and Banking, Academia de Studii Economice din Bucuresti, Romania / Facultatea de Finante, Asigurari, Banci si Burse de Valori / Catedra de Finante, vol. 10(1), pages 026-046, June.
  • Handle: RePEc:rfb:journl:v:10:y:2018:i:1:p:026-046
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