IDEAS home Printed from https://ideas.repec.org/a/sae/envirc/v33y2015i4p765-779.html
   My bibliography  Save this article

Is fiscal fatigue a threat to consolidation programmes?

Author

Listed:
  • Luca Agnello
  • Vítor Castro
  • Ricardo M Sousa

Abstract

Abstract Building on a narrative approach to identify episodes of fiscal consolidation, data for a group of seventeen industrial countries over the period 1978–2009, and continuous-time duration models, we find evidence suggesting that the likelihood of a fiscal consolidation ending increases over time, but only for programmes that last fewer than six years. Additionally, fiscal consolidations tend to last longer in non-European than in European countries. Our results emphasize that chronic fiscal imbalances might lead to a vicious austerity cycle, while discipline in the behaviour of fiscal authorities is a means of achieving credible and shorter adjustment measures. Therefore, fiscal fatigue is likely to compromise the implementation and successfulness of fiscal consolidation programmes.

Suggested Citation

  • Luca Agnello & Vítor Castro & Ricardo M Sousa, 2015. "Is fiscal fatigue a threat to consolidation programmes?," Environment and Planning C, , vol. 33(4), pages 765-779, August.
  • Handle: RePEc:sae:envirc:v:33:y:2015:i:4:p:765-779
    as

    Download full text from publisher

    File URL: http://epc.sagepub.com/content/33/4/765.abstract
    Download Restriction: no

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. repec:spr:empeco:v:54:y:2018:i:3:d:10.1007_s00181-017-1260-3 is not listed on IDEAS
    2. Luca Agnello & Giorgio Fazio & Ricardo M. Sousa, 2016. "National fiscal consolidations and regional inequality in Europe," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 9(1), pages 59-80.
    3. Reda Cherif & Fuad Hasanov, 2018. "Public debt dynamics: the effects of austerity, inflation, and growth shocks," Empirical Economics, Springer, vol. 54(3), pages 1087-1105, May.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:envirc:v:33:y:2015:i:4:p:765-779. 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: (SAGE Publications). General contact details of provider: .

    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.

    We have no references for this item. You can help adding them by using 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.