Is fiscal policy effective in Brazil? An empirical analysis
Autor(a) principal: | |
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Data de Publicação: | 2016 |
Outros Autores: | , |
Tipo de documento: | Artigo |
Idioma: | eng |
Título da fonte: | Repositório Institucional do FGV (FGV Repositório Digital) |
Texto Completo: | http://hdl.handle.net/10438/17513 |
Resumo: | The main goal of this paper is to determine the effectiveness of fiscal policy in Brazil. With a sample from 1997 to 2014, we are not able to obtain the relevant impact of fiscal stimuli on output, even when altering both the methodology and the model specifications. Our more robust estimate of the government spending fiscal multiplier is approximately 0.5. Higher multipliers are reported using TVAR and other approaches and specifications, although they are biased for outliers and lack of robustness. We were not able to find any statistically significant response of the output to tax changes, but changes in output appear to generate tax revenue. Finally, we discuss plausible explanations for such ineffectiveness of fiscal policy. Among several factors highlighted by the economic literature, we suggest that the level of the government spending undermines the importance of fiscal shocks. That would explain the type of fiscal conundrum manifested in Brazil. |
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Mendonça, Diogo de PrinceMarçal, Emerson FernandesBrito, Márcio Holland deEscolas::EESP2016-11-22T12:16:26Z2016-11-22T12:16:26Z2016TD 433http://hdl.handle.net/10438/17513The main goal of this paper is to determine the effectiveness of fiscal policy in Brazil. With a sample from 1997 to 2014, we are not able to obtain the relevant impact of fiscal stimuli on output, even when altering both the methodology and the model specifications. Our more robust estimate of the government spending fiscal multiplier is approximately 0.5. Higher multipliers are reported using TVAR and other approaches and specifications, although they are biased for outliers and lack of robustness. We were not able to find any statistically significant response of the output to tax changes, but changes in output appear to generate tax revenue. Finally, we discuss plausible explanations for such ineffectiveness of fiscal policy. Among several factors highlighted by the economic literature, we suggest that the level of the government spending undermines the importance of fiscal shocks. That would explain the type of fiscal conundrum manifested in Brazil.engEESP - Textos para Discussão;TD 433Fiscal policyFiscal multiplierStructural VARTVARSign restrictionEconomiaPolítica tributáriaBrasil - Condições econômicasModelos macroeconômicosIs fiscal policy effective in Brazil? 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dc.title.eng.fl_str_mv |
Is fiscal policy effective in Brazil? An empirical analysis |
title |
Is fiscal policy effective in Brazil? An empirical analysis |
spellingShingle |
Is fiscal policy effective in Brazil? An empirical analysis Mendonça, Diogo de Prince Fiscal policy Fiscal multiplier Structural VAR TVAR Sign restriction Economia Política tributária Brasil - Condições econômicas Modelos macroeconômicos |
title_short |
Is fiscal policy effective in Brazil? An empirical analysis |
title_full |
Is fiscal policy effective in Brazil? An empirical analysis |
title_fullStr |
Is fiscal policy effective in Brazil? An empirical analysis |
title_full_unstemmed |
Is fiscal policy effective in Brazil? An empirical analysis |
title_sort |
Is fiscal policy effective in Brazil? An empirical analysis |
author |
Mendonça, Diogo de Prince |
author_facet |
Mendonça, Diogo de Prince Marçal, Emerson Fernandes Brito, Márcio Holland de |
author_role |
author |
author2 |
Marçal, Emerson Fernandes Brito, Márcio Holland de |
author2_role |
author author |
dc.contributor.unidadefgv.por.fl_str_mv |
Escolas::EESP |
dc.contributor.author.fl_str_mv |
Mendonça, Diogo de Prince Marçal, Emerson Fernandes Brito, Márcio Holland de |
dc.subject.eng.fl_str_mv |
Fiscal policy Fiscal multiplier Structural VAR TVAR Sign restriction |
topic |
Fiscal policy Fiscal multiplier Structural VAR TVAR Sign restriction Economia Política tributária Brasil - Condições econômicas Modelos macroeconômicos |
dc.subject.area.por.fl_str_mv |
Economia |
dc.subject.bibliodata.por.fl_str_mv |
Política tributária Brasil - Condições econômicas Modelos macroeconômicos |
description |
The main goal of this paper is to determine the effectiveness of fiscal policy in Brazil. With a sample from 1997 to 2014, we are not able to obtain the relevant impact of fiscal stimuli on output, even when altering both the methodology and the model specifications. Our more robust estimate of the government spending fiscal multiplier is approximately 0.5. Higher multipliers are reported using TVAR and other approaches and specifications, although they are biased for outliers and lack of robustness. We were not able to find any statistically significant response of the output to tax changes, but changes in output appear to generate tax revenue. Finally, we discuss plausible explanations for such ineffectiveness of fiscal policy. Among several factors highlighted by the economic literature, we suggest that the level of the government spending undermines the importance of fiscal shocks. That would explain the type of fiscal conundrum manifested in Brazil. |
publishDate |
2016 |
dc.date.accessioned.fl_str_mv |
2016-11-22T12:16:26Z |
dc.date.available.fl_str_mv |
2016-11-22T12:16:26Z |
dc.date.issued.fl_str_mv |
2016 |
dc.type.status.fl_str_mv |
info:eu-repo/semantics/publishedVersion |
dc.type.driver.fl_str_mv |
info:eu-repo/semantics/article |
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article |
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publishedVersion |
dc.identifier.uri.fl_str_mv |
http://hdl.handle.net/10438/17513 |
dc.identifier.sici.none.fl_str_mv |
TD 433 |
identifier_str_mv |
TD 433 |
url |
http://hdl.handle.net/10438/17513 |
dc.language.iso.fl_str_mv |
eng |
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eng |
dc.relation.ispartofseries.por.fl_str_mv |
EESP - Textos para Discussão;TD 433 |
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info:eu-repo/semantics/openAccess |
eu_rights_str_mv |
openAccess |
dc.source.none.fl_str_mv |
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