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Fiscal Policy, Stabilization, and Growth: Prudence or Abstinence?

Listed editor(s):
  • Rodrigo Suescún
  • Guillermo Perry
  • Luis Servén
Registered editor(s):
Listed author(s):
  • Rogério L.F. Werneck
  • Timothy Irwin
  • Federico Sturzenegger
  • Guillermo Perry
  • Luis Servén
  • Ilian Mihov
  • Francesco Giavazzi
  • Olivier Blanchard
  • Carlos Hamilton Vasconcelos Araújo
  • Rodrigo Suescún
  • Pedro Cavalcanti Gomes Ferreira
  • Michael Smart
  • Jack M. Mintz
  • Antonio Fatás

Fiscal policy in Latin America has been guided primarily by short-term liquidity targets whose observance was taken as the main exponent of fiscal prudence, with attention focused almost exclusively on the levels of public debt and the cash deficit. Very little attention was paid to the effects of fiscal policy on growth and on macroeconomic volatility over the cycle. Important issues such as the composition of public expenditures (and its effects on growth), the ability of fiscal policy to stabilize cyclical fluctuations, and the currency composition of public debt were largely neglected. As a result, fiscal policy has often amplified cyclical volatility and dampened growth. 'Fiscal Policy, Stabilization, and Growth' explores the conduct of fiscal policy in Latin America and its consequences for macroeconomic stability and long-term growth. In particular, this book highlights the pro-cyclical and anti-investment biases embedded in the region's fiscal policies, explores their causes and macroeconomic consequences, and assesses their possible solutions. This publication belongs to the Latin American Development Forum Series (LADF), sponsored by the Inter-American Development Bank, the United Nations Economic Commission for Latin America and the Caribbean, and the World Bank.

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This book is provided by Inter-American Development Bank in its series IDB Publications (Books) with number 59778 and published in 2008.
ISBN: 9780821370841
Handle: RePEc:idb:idbbks:59778
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  1. Aschauer, David Alan, 1989. "Is public expenditure productive?," Journal of Monetary Economics, Elsevier, vol. 23(2), pages 177-200, March.
  2. Jérôme Creel & Francesco Saraceno & Paola Veroni, 2007. "Has the Golden Rule of Public Finance Made a difference in the UK," Sciences Po publications 2007-13, Sciences Po.
  3. Barro, Robert J & Lee, Jong-Wha, 2001. "International Data on Educational Attainment: Updates and Implications," Oxford Economic Papers, Oxford University Press, vol. 53(3), pages 541-563, July.
  4. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 107(2), pages 407-437.
  5. Ferreira, Pedro Cavalcanti & Issler, Joao Victor & de Abreu Pessoa, Samuel, 2004. "Testing production functions used in empirical growth studies," Economics Letters, Elsevier, vol. 83(1), pages 29-35, April.
  6. Easterly, William & Rebelo, Sergio, 1993. "Fiscal policy and economic growth: An empirical investigation," Journal of Monetary Economics, Elsevier, vol. 32(3), pages 417-458, December.
  7. Roberto Perotti, 2004. "Public investment: another (different) look," Working Papers 277, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
  8. Canning, David & Bennathan, Esra, 2000. "The social rate of return on infrastructure investments," Policy Research Working Paper Series 2390, The World Bank.
  9. repec:spo:wpecon:info:hdl:2441/2681 is not listed on IDEAS
  10. Nouriel Roubini & Jeffrey Sachs, 1989. "Government Spending and Budget Deficits in the Industrial Economies," NBER Working Papers 2919, National Bureau of Economic Research, Inc.
  11. Pereira, Ricardo Antonio de Castro & Ferreira, Pedro Cavalcanti, 2007. "Efeitos de crescimento e bem-estar da Lei de parceria público-privada no Brasil," FGV/EPGE Economics Working Papers (Ensaios Economicos da EPGE) 648, FGV/EPGE - Escola Brasileira de Economia e Finanças, Getulio Vargas Foundation (Brazil).
  12. Alfredo M. Pereira & Maria de Fátima Pinho, 2006. "Public Investment, Economic Performance and Budgetary Consolidation: VAR Evidence for the 12 Euro Countries," Working Papers 40, Department of Economics, College of William and Mary.
  13. Jérôme Creel & Francesco Saraceno & Paola Veroni, 2006. "Estimating the impact of public investment in the united Kingdom : Has the Golden Rule of Public Finance Made a Difference ?," Sciences Po publications info:hdl:2441/2681, Sciences Po.
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