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On the Composition of Public Spending and Taxes

Author

Listed:
  • George Economides
  • Hyun Park
  • Apostolis Philippopoulos
  • Stelios Sakkas

Abstract

This paper studies the implications of changes in the fiscal (spending-tax) policy mix when all categories of spending and taxes are according to their functional breakdown. In so doing, we build a general equilibrium OLG model which naturally incorporates the main functional categories of public spending and taxes as in the euro area. Departing from the crisis year of 2008, the main result is that an increase in public spending on education and health would have outperformed all other changes in fiscal policy that have either happened or have been debated in policy circles.

Suggested Citation

  • George Economides & Hyun Park & Apostolis Philippopoulos & Stelios Sakkas, 2015. "On the Composition of Public Spending and Taxes," CESifo Working Paper Series 5510, CESifo.
    • Handle: RePEc:ces:ceswps:_5510
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    Cited by:

    1. David Bauer & Joachim Ragnitz & Christian Ochsner, 2018. "Strategies for the Best Equipment and Use of Funds after 2020," ifo Dresden Studien, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 82.
    2. Barbara Annicchiarico & Claudio Battiati & Claudio Cesaroni & Fabio Di Dio & Francesco Felici, 2017. "IGEM-PA: a Variant of the Italian General Equilibrium Model for Policy Analysis," Working Papers 2, Department of the Treasury, Ministry of the Economy and of Finance.

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    More about this item

    Keywords

    government expenditure; public finance;

    JEL classification:

    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
    • E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General

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