This paper provides an assessment of the consistency of unemployment and output forecasts. We show that, consistent with Okun’s Law, forecasts of real GDP growth and the change in unemployment are negatively correlated. The Okun coefficient—the responsiveness of unemployment to...

Using a panel of developed and developing countries and data for the period 1980 to 2005, we find that debt crises trigger financial reforms. We also show that (i) when general economic conditions deteriorate, financial reforms become more likely to take place; (ii) IMF-stabilization programmes and...

This paper investigates the impact of sovereign defaults on the ability of the corporate sector in emerging nations to finance itself abroad. The hypothesis here is that defaults have a negative spillover effect on the private sector through credit rationing. We explore a novel dataset covering...

This paper provides an assessment of the consistency of unemployment and output forecasts. We show that, consistent with Okun’s Law, forecasts of real GDP growth and the change in unemployment are negatively correlated. The Okun coefficient—the responsiveness of unemployment to growth—from...

We assess the sustainability of public finances in OECD countries using panel unit root and cointegration analyses. Results show: no cointegration (no sustainability) between revenues and expenditures; improvement of the primary balances after worsening debt ratios; causality from government...

We use data for a panel of 60 countries over the period 1980–2005 to investigate the main drivers of the likelihood of structural reforms. We find that: (i) external debt crises are the main trigger of financial and banking reforms; (ii) inflation and banking crises are the key drivers of...

This paper addresses the interactions between globalization, the quality of democracy, and economic convergence using simultaneous estimation techniques. To reflect process, we use multi-dimensional, de facto, and continuous measures of democracy and globalization. To reflect context, as defined...

We use a panel of 155 countries for 1970-2010 to study (two-way) causality between government spending, revenue and growth. Our results suggest the existence of weak evidence supporting causality from expenditures or revenues to GDP per capita and provide evidence supporting Wagner’s Law.

We measure the success of fiscal consolidation, with alternative definitions, based on <italic>ad-hoc</italic> quantitative approaches and on a policy-action approach. The cyclically adjusted primary balance, and the duration of the consolidation contribute for its success, and the opposite applies for...

We assess the fiscal composition-growth nexus, using a large country panel, accounting for the usually encountered econometric pitfalls. Our results show that revenues have no significant impact on growth whereas expenditures have negative effects. The same is true for the OECD with the addition...