Effects of Fiscal Policy on Private Consumption
This paper examines the effects of fiscal policy on private consumption. The paper evaluates the assumption that the effects of fiscal policy are dependent on the public sector's financial situation, which changes the private sector's income expectations. For this purpose regression equations are run with international data. From the international evidence it is found that every component of fiscal policy, public consumption, taxes, and transfers, may have regime-specific effects related to the financial balance in the public sector. Regressions of Finnish data show that private sector's income expectations may have played an important role in the private consumption changes of the early 199Os. In light of the international estimations, it is also found that changes in the unemployment rate may have regime-specific effects on consumption.
|Date of creation:||01 Jan 1996|
|Date of revision:|
|Contact details of provider:|| Postal: Arkadiankatu 7, P.O. Box 1279, FI-00101 Helsinki|
Phone: +358 295 519 400
Fax: +358 295 519 599
Web page: http://www.vatt.fi/
More information through EDIRC
|Order Information:|| Email: |
When requesting a correction, please mention this item's handle: RePEc:fer:dpaper:133. 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: (Anita Niskanen)
If references are entirely missing, you can add them using this form.