Fiscal Policy Dynamics with a Public-Debt Guideline.

This paper analyzes the implications of a cost of deviating upwards from a public-debt/output guideline, as the 0.6 ratio in the Maastricht Treaty, in the context of a fiscal policymaking model. Given a pre-announced timetable for enforcement, the dynamic paths of the tax rate and government spending, which depart from smoothing over time, and the public debt are characterized.

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Year of publication:	2001
Authors:	Hercowitz, Z. ; Strawczynski, M.
Institutions:	Foerder Institute for Economic Research, Eitan Berglas School of Economics
Subject:	PUBLIC DEBT \| TAXATION \| POLICY MAKING

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Series:	Tel Aviv.
Type of publication:	Book / Working Paper
Notes:	21 pages
Classification:	E62 - Fiscal Policy; Public Expenditures, Investment, and Finance; Taxation ; H63 - Debt; Debt Management
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005783686