Article ID Journal Published Year Pages File Type
966264 Journal of Macroeconomics 2007 28 Pages PDF
Abstract
This paper empirically studies the effects of fiscal policy shocks on private consumption. Further, it investigates if the initial financing needs of the government or previous fiscal deficits affect that relationship. We use yearly data between 1970 and 2000 for 40 countries, of which 19 are industrialized and 21 are developing countries. In general, the estimation results seem to indicate that government consumption shocks have Keynesian effects for both industrial and developing countries. In the case of tax shocks, the evidence is mixed. Furthermore, there is no evidence that favors the hypothesis of expansionary fiscal consolidations.
Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
Authors
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