Primary surplus and debt projections based on estimated fiscal reaction functions for euro area countries
We project the path of the public debt and primary surpluses for a number of countries in the euro area under a fiscal rule based on a set of estimated fiscal policy reaction functions. Our fiscal rule represents a fiscal analogue to a well-known monetary policy rule, and it is calibrated using country-specific as well as euro area-wide parameter estimates. We then forecast the dynamics of the fiscal aggregates under different convergence, growth, and interest rate scenarios and investigate the implications of these scenarios in projecting the future path of fiscal aggregates. We argue that our forecasting methodology may be used to deliver insights into the medium-run effects of different fiscal policy rules and to provide some early warning of future fiscal pressures
|Date of creation:||Jan 2014|
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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Agustín S. Bénétrix & Philip R. Lane, 2012.
"Fiscal Cyclicality and EMU,"
The Institute for International Integration Studies Discussion Paper Series
- Plödt, Martin & Reicher, Claire, 2014. "Estimating simple fiscal policy reaction functions for the euro area countries," Kiel Working Papers 1899, Kiel Institute for the World Economy (IfW).
- Cândida Ferreira, 2009.
"Fiscal Behaviour in the European Union: Rules, Fiscal Decentralization and Government Indebtedness,"
Working Papers Department of Economics
2009/23, ISEG - School of Economics and Management, Department of Economics, University of Lisbon.
- Afonso, António & Hauptmeier, Sebastian, 2009. "Fiscal behaviour in the European Union: rules, fiscal decentralization and government indebtedness," Working Paper Series 1054, European Central Bank.
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