| 来源类型 | Discussion paper
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| 规范类型 | 论文
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| 来源ID | DP1269
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| DP1269 Politics and Trade Policy |
| Elhanan Helpman
|
| 发表日期 | 1995-11-30
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| 出版年 | 1995
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| 语种 | 英语
|
| 摘要 | In earlier work we documented two episodes in which a sharp fiscal consolidation was associated with a surprisingly large expansion in private domestic demand. In this paper we draw on further evidence to investigate if and when fiscal policy changes can have such non-Keynesian effects. In the first part of the paper, we analyse cross-country data for 19 OECD countries. In the second part we concentrate on the Swedish fiscal expansion of the early 1990s. The cross-country evidence on private consumption confirms that fiscal policy changes - both contractions and expansions - can have non-Keynesian effects if they are sufficiently large and persistent. It also suggests that these effects can result not only from changes in public consumption, but to some extent also from changes in taxes and transfers. The latter result is also consistent with the Swedish experience, where a decrease in net taxes (with almost no change in public consumption) was associated with a dramatic fall in private domestic demand. Our evidence and that from other studies agree that during the Swedish fiscal expansion of the early 1990s a large negative error should be interpreted, but it is clear that the most obvious candidates (wealth effects and after-tax real interest rate effects) are not sufficient to explain it. This error may reflect a large downward revision of permanent disposable income, which affected the consumption choices of Swedish households over and beyond the negative effects of the drop in real asset prices. We suggest that this downward revision in permanent disposable income may have been triggered, at least partly, by the fiscal expansion of the early 1990s. |
| 主题 | International Macroeconomics
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| 关键词 | Fiscal policy
Private consumption
Private investment
Public consumption
Public debt
Public deficit
Stabilization
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| URL | https://cepr.org/publications/dp1269
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| 来源智库 | Centre for Economic Policy Research (United Kingdom)
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| 资源类型 | 智库出版物
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| 条目标识符 | http://119.78.100.153/handle/2XGU8XDN/530411
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推荐引用方式
GB/T 7714 |
Elhanan Helpman. DP1269 Politics and Trade Policy. 1995.
|
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