The design of fiscal adjustments

Alberto Alesina and Silvia Ardagna

No 18423, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper offers three results. First, in line with the previous literature, we confirm that fiscal adjustments based mostly on the spending side are less likely to be reversed. Second, spending based fiscal adjustments have caused smaller recessions than tax based fiscal adjustments. Finally, certain combinations of policies have made it possible for spending based fiscal adjustments to be associated with growth in the economy even on impact rather than with a recession. Thus, expansionary fiscal adjustments are possible.

JEL-codes: H2 H3 H5 H62 (search for similar items in EconPapers)
Date: 2012-09
New Economics Papers: this item is included in nep-pbe
Note: POL
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Citations: View citations in EconPapers (54)

Published as The Design of Fiscal Adjustments , Alberto Alesina, Silvia Ardagna. in Tax Policy and the Economy, Volume 27 , Brown. 2013

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Related works:
Chapter: The Design of Fiscal Adjustments (2013)
Working Paper: The Design of Fiscal Adjustments (2013)
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