In this paper we provide a formal test of Barro's tax-smoothing model, using Spanish data covering the period 1850-2022. First, we found that the tax-tilting component has been very important for the Spanish government and is a symptom of the existence of a public deficit bias that has existed...

This paper empirically analyses the relationship between political leaders’ socioeconomic backgrounds and public budget deficits utilising panel data on 21 OECD countries from 1980 to 2008. Building on sociological, as well as economic, research, we argue that the socioeconomic status of...

By an endogenous growth model with two-period overlapping generations structure and money holding of consumers, we examine the existence of budget deficit in an economy which endogenously grows by investments of firms. The main results are as follows. (1) Budget deficit is necessary for full...

This paper investigates the dynamic stability of public debt and its solvency condition in the face of crisis periods (1980-2021) in a sample of 11 euro-area countries. The focus is on the feedback loop between the dynamic stability of public debt and interest rates, discounted by economic...

The US Federal Reserve System is conventionally understood as a private-market stabilising institution that has no settled role in supporting the fiscal power of the Treasury. Contra that view, this article argues that the US central bank has always had an extensive fiscal role: building,...