Reforming the Fiscal Framework. The Case of Sweden 1973-2013

Lars Jonung ()

No 2014:26, Working Papers from Lund University, Department of Economics

Abstract: This paper explores the evolution of Swedish fiscal policy from one extreme approach to another one in less than four decades. After the demise of the Bretton Woods-system in the early 1970s, Swedish fiscal policy was based on a Keynesian approach with the goal to stabilize the business cycle and maintain full employment using a large set of instruments in a discretionary manner. In the wake of the deep financial crisis in the early 1990s, this policy paradigm was eventually replaced by a rule-bound scheme. A fiscal framework was set-up as an instrument to rein in public finances. The present goal of fiscal policy is to maintain sustainable public finances while avoiding discretionary measures.

Keywords: Fiscal rules; fiscal policy council; fiscal policy; policy learning; Sweden (search for similar items in EconPapers)
JEL-codes: E52 E62 E63 E65 F44 H62 O52 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2014-06-30
New Economics Papers: this item is included in nep-eec and nep-mac
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Citations: View citations in EconPapers (6)

Forthcoming as Jonung, Lars, 'Reforming the Fiscal Framework. The Case of Sweden 1973-2013' in "Reform Capacity and Macroeconomic Performance in the Nordic Countries", Oxford University Press.

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