The effects of fiscal policy on the Spanish economy: Keynesian or non-Keynesian behavior?

The results of our simulations show that the effects of shocks to Spanish total government receipts and total government expenditure on real variables are permanent, while their effects on nominal variables are temporary. The response of the Spanish real GDP to a positive shock to total government receipts is positive. In contrast, the response of the Spanish real GDP to a positive shock to total government expenditure is positive in the short run, but negative in the medium to long run. Consequently, these results suggest the existence of non-Keynesian effects related to a disturbance on public receipts and the presence of short-run Keynesian effects related to a disturbance on public expenditure. Both facts must be taken into account when formulating appropriated economic policy measures.