IDEAS home Printed from
MyIDEAS: Login to save this paper or follow this series

Potential Growth and Business Cycle in the Spanish Economy: Implications for Fiscal Policy

  • Rafael Domenech

    (Economic Bureau of the Prime Minister, Spain. University of Valencia, Spain)

  • Ángel Estrada

    (Economic Bureau of the Prime Minister, Spain)

  • Luis González-Calbet

    (Economic Bureau of the Prime Minister, Spain)

An accurately estimation of the cyclical position of an economy is a necessary condition for the success of fiscal stabilisation policies. In this paper we show that the estimation of the output gap by means of decomposing a production function produces similar results to univariate and multivariate methods, increasing their robustness and allowing us to conclude that most of the information on the economic cycle is included in the cyclical component of the unemployment rate. The results also indicate that there is reduced uncertainty about the periods when the Spanish economy has clearly been in a deep recession or in a sharp expansion. These periods have been limited and of relatively short duration. Fiscal policy should pay particular attention to these episodes, when discretionary stabilisation policies make most sense.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
File Function: First version, 2007
Download Restriction: no

Paper provided by International Economics Institute, University of Valencia in its series Working Papers with number 0705.

in new window

Length: 28 pages
Date of creation: Nov 2007
Date of revision:
Handle: RePEc:iei:wpaper:0705
Contact details of provider: Phone: +34 964 728590
Fax: +34 964 728591
Web page:

More information through EDIRC

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:iei:wpaper:0705. 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: (Investigación IEI)

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.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with 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 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.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.