The (non-)Keynesian effects of fiscal austerity: New evidence from a large sample
Autor(a) principal: | |
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Data de Publicação: | 2022 |
Outros Autores: | , |
Tipo de documento: | Artigo |
Idioma: | eng |
Título da fonte: | Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
Texto Completo: | http://hdl.handle.net/10400.5/25394 |
Resumo: | We empirically assess whether the negative response of private consumption and private investment to fiscal consolidation usually expected is reversed. We focus on a sample of 174 countries between 1970 and 2018 to determine episodes of fiscal consolidations using three alternative measures of the cyclically adjusted primary balance: (1) an International Monetary Fund (IMF)-World Economic Outlook (WEO) based measure, (2) a Hodrick-Prescott–based measure, and (3) a measure based on Hamilton (2018). We find that, first, increases in government consumption have a Keynesian effect on real per capita private consumption; second, tax increases have a positive effect on private consumption when a fiscal consolidation occurs; and, third, fiscal contraction has a crowding-in effect on private investment. Moreover, expansionary fiscal consolidations occur in highly indebted advanced economies, in particular, after an increase in taxes. We conclude that the negative effects of taxation on private consumption are larger when developing economies are experiencing a financial crisis and are not consolidating. |
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The (non-)Keynesian effects of fiscal austerity: New evidence from a large sampleConsumptionEndogeneityFilteringFinancial CrisesFiscal ConsolidationInvestmentNon-Keynesian EffectsPanel DataWe empirically assess whether the negative response of private consumption and private investment to fiscal consolidation usually expected is reversed. We focus on a sample of 174 countries between 1970 and 2018 to determine episodes of fiscal consolidations using three alternative measures of the cyclically adjusted primary balance: (1) an International Monetary Fund (IMF)-World Economic Outlook (WEO) based measure, (2) a Hodrick-Prescott–based measure, and (3) a measure based on Hamilton (2018). We find that, first, increases in government consumption have a Keynesian effect on real per capita private consumption; second, tax increases have a positive effect on private consumption when a fiscal consolidation occurs; and, third, fiscal contraction has a crowding-in effect on private investment. Moreover, expansionary fiscal consolidations occur in highly indebted advanced economies, in particular, after an increase in taxes. We conclude that the negative effects of taxation on private consumption are larger when developing economies are experiencing a financial crisis and are not consolidating.ElsevierRepositório da Universidade de LisboaAfonso, AntónioAlves, JoséJalles, José Tovar2022-09-06T13:50:37Z20222022-01-01T00:00:00Zinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articleapplication/pdfhttp://hdl.handle.net/10400.5/25394engAfonso, António; José Alves and João Tovar Jalles.(2022). "The (non-) Keynesian effects of fiscal austerity: New evidence from a large sample." Economic Systems, Vol. 46: 100981.0939-3625doi.org/10.1016/j.ecosys.2022.100981info:eu-repo/semantics/openAccessreponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãoinstacron:RCAAP2023-03-06T14:54:57Zoai:www.repository.utl.pt:10400.5/25394Portal AgregadorONGhttps://www.rcaap.pt/oai/openaireopendoar:71602024-03-19T17:09:16.824188Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãofalse |
dc.title.none.fl_str_mv |
The (non-)Keynesian effects of fiscal austerity: New evidence from a large sample |
title |
The (non-)Keynesian effects of fiscal austerity: New evidence from a large sample |
spellingShingle |
The (non-)Keynesian effects of fiscal austerity: New evidence from a large sample Afonso, António Consumption Endogeneity Filtering Financial Crises Fiscal Consolidation Investment Non-Keynesian Effects Panel Data |
title_short |
The (non-)Keynesian effects of fiscal austerity: New evidence from a large sample |
title_full |
The (non-)Keynesian effects of fiscal austerity: New evidence from a large sample |
title_fullStr |
The (non-)Keynesian effects of fiscal austerity: New evidence from a large sample |
title_full_unstemmed |
The (non-)Keynesian effects of fiscal austerity: New evidence from a large sample |
title_sort |
The (non-)Keynesian effects of fiscal austerity: New evidence from a large sample |
author |
Afonso, António |
author_facet |
Afonso, António Alves, José Jalles, José Tovar |
author_role |
author |
author2 |
Alves, José Jalles, José Tovar |
author2_role |
author author |
dc.contributor.none.fl_str_mv |
Repositório da Universidade de Lisboa |
dc.contributor.author.fl_str_mv |
Afonso, António Alves, José Jalles, José Tovar |
dc.subject.por.fl_str_mv |
Consumption Endogeneity Filtering Financial Crises Fiscal Consolidation Investment Non-Keynesian Effects Panel Data |
topic |
Consumption Endogeneity Filtering Financial Crises Fiscal Consolidation Investment Non-Keynesian Effects Panel Data |
description |
We empirically assess whether the negative response of private consumption and private investment to fiscal consolidation usually expected is reversed. We focus on a sample of 174 countries between 1970 and 2018 to determine episodes of fiscal consolidations using three alternative measures of the cyclically adjusted primary balance: (1) an International Monetary Fund (IMF)-World Economic Outlook (WEO) based measure, (2) a Hodrick-Prescott–based measure, and (3) a measure based on Hamilton (2018). We find that, first, increases in government consumption have a Keynesian effect on real per capita private consumption; second, tax increases have a positive effect on private consumption when a fiscal consolidation occurs; and, third, fiscal contraction has a crowding-in effect on private investment. Moreover, expansionary fiscal consolidations occur in highly indebted advanced economies, in particular, after an increase in taxes. We conclude that the negative effects of taxation on private consumption are larger when developing economies are experiencing a financial crisis and are not consolidating. |
publishDate |
2022 |
dc.date.none.fl_str_mv |
2022-09-06T13:50:37Z 2022 2022-01-01T00:00:00Z |
dc.type.status.fl_str_mv |
info:eu-repo/semantics/publishedVersion |
dc.type.driver.fl_str_mv |
info:eu-repo/semantics/article |
format |
article |
status_str |
publishedVersion |
dc.identifier.uri.fl_str_mv |
http://hdl.handle.net/10400.5/25394 |
url |
http://hdl.handle.net/10400.5/25394 |
dc.language.iso.fl_str_mv |
eng |
language |
eng |
dc.relation.none.fl_str_mv |
Afonso, António; José Alves and João Tovar Jalles.(2022). "The (non-) Keynesian effects of fiscal austerity: New evidence from a large sample." Economic Systems, Vol. 46: 100981. 0939-3625 doi.org/10.1016/j.ecosys.2022.100981 |
dc.rights.driver.fl_str_mv |
info:eu-repo/semantics/openAccess |
eu_rights_str_mv |
openAccess |
dc.format.none.fl_str_mv |
application/pdf |
dc.publisher.none.fl_str_mv |
Elsevier |
publisher.none.fl_str_mv |
Elsevier |
dc.source.none.fl_str_mv |
reponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação instacron:RCAAP |
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Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação |
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RCAAP |
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RCAAP |
reponame_str |
Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
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Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
repository.name.fl_str_mv |
Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação |
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1799131187647610880 |