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Bi, Huixin; Leeper, Eric M. - 2013

The authors study the implications of fiscal policy behaviour for sovereign risk in a framework that determines a country's fiscal limit, the point at which, for economic or political reasons, taxes and spending can no longer adjust to stabilize debt. A real business cycle model maps the...

Persistent link: https://www.econbiz.de/10009783106

Individual Treatment Effects of Budget Balance Rules

Caselli, Francesca; Stöhlker, Daniel; Wingender, Philippe - 2021

This paper investigates the heterogenous effects of budget balance rules on fiscal policy in a large sample of …-in-Differences Method. Our results indicate that countries with a budget balance rule improve their fiscal balance on average by around 3 … have had large deficits in the absence of the fiscal rule exhibit positive treatment effects, thus reducing their budget …

Persistent link: https://www.econbiz.de/10013250087

Debt Control : An Alternative Route to a Balanced Budget

Larson, Sven R. - 2014

This paper discusses an alternative route to a balanced budget, namely through debt control. Two models are compared …

Persistent link: https://www.econbiz.de/10013039778

The fallacy of the fiscal theory of the price level : one last time

Buiter, Willem H.; Sibert, Anne C. - 2018

fundamental compounded fallacy: confusing the intertemporal budget constraint (IBC) of the State, holding with equality and with …

Persistent link: https://www.econbiz.de/10011884113

The fallacy of the fiscal theory of the price level - one last time

Buiter, Willem H.; Sibert, Anne C. - 2017

fundamental compounded fallacy: confusing the intertemporal budget constraint (IBC) of the State, holding with equality and with …

Persistent link: https://www.econbiz.de/10011731847

The Political Economy of Fiscal Consolidation

Price, Robert W. - 2011

This paper explores the political economy of fiscal adjustment. It begins with an examination of the evidence for, and sources of, ‘deficit bias', including political and governance factors, public attitudes, the role of financial markets and imprecision about which debt targets should be...

Persistent link: https://www.econbiz.de/10013122783

The Political Economy of Fiscal Consolidation

Price, Robert W. - 2010

This paper explores the political economy of fiscal adjustment. It begins with an examination of the evidence for, and sources of, ‘deficit bias’, including political and governance factors, public attitudes, the role of financial markets and imprecision about which debt targets should be...

Persistent link: https://www.econbiz.de/10012446110

Optimal Debt Policy Under Asymmetric Risk

Escolano, Julio - 2016

In the paper we show that, most of the time, smooth reduction in the debt ratio is optimal for tax-smoothing purposes when fiscal risks are asymmetric, with large debt-augmenting shocks more likely than commensurate debt reducing shocks. Asymmetric risks are a feature of 200 years of data for...

Persistent link: https://www.econbiz.de/10012977785

Fiscal Discipline and Exchange Rates : Does Politics Matter?

Tavares, José - 2016

We look at the effect of exchange rate regimes on fiscal discipline, taking into account the effect of underlying political conditions. We present a model where strong politics (defined as policymakers facing longer political horizon and higher cohesion) are associated with better fiscal...

Persistent link: https://www.econbiz.de/10012977352

Sustainability of Public Finances and Automatic Stabilisation Under a Rule of Budgetary Discipline

Marin, Jose M. - 2021

This paper addresses the question of how a fiscal rule of a general type can preserve the sustainability of public finances and provide automatic stabilisation, taking as given interest rates and price stability. This issue can be considered complementary to the analysis of monetary policy...

Persistent link: https://www.econbiz.de/10013320166