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Measuring China's Fiscal Policy Stance

Author

Listed:
  • Sebastian Dullien

    (Financial Times Deutschland)

Abstract

This paper argues that the tradtitional way of gauging a country's fiscal policy stance by looking at government budget deficit or cyclically adjusted budget deficits is misleading in the case of China, since a lot of what usually would be considered fiscal policy is conducted via investment by state owned enterprises. The paper therefore proposes a different indicator for the fiscal policy stance, constructed from government consumption, government expenditure, the state-owned- enterprises' investments and tax revenue. Using this indicator, it can be shown that fiscal policy has been strongly counter-cyclical in China over the past two decades.

Suggested Citation

  • Sebastian Dullien, 2005. "Measuring China's Fiscal Policy Stance," Macroeconomics 0502032, EconWPA.
  • Handle: RePEc:wpa:wuwpma:0502032
    Note: Type of Document - pdf; pages: 11
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    File URL: http://econwpa.repec.org/eps/mac/papers/0502/0502032.pdf
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    References listed on IDEAS

    as
    1. Jia, Kang, 2002. "Pro-active fiscal policy in China since 1998: backgrounds and its emphases in practice," Journal of Asian Economics, Elsevier, vol. 13(5), pages 615-622.
    2. Lin, Guijun & Schramm, Ronald M., 2003. "China's foreign exchange policies since 1979: A review of developments and an assessment," China Economic Review, Elsevier, vol. 14(3), pages 246-280.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Leon du Toit, 2009. "Economic Crises, Stabilisation Policy and Output in Emerging Market Economies," Working Papers 20/2009, Stellenbosch University, Department of Economics.

    More about this item

    Keywords

    Fiscal Policy; China; State-Owned Enterprises; Statistics;

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy

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