Tracking fiscal discipline. Looking for a PIIGS on the wing

David Neto

International Economics, 2020, issue 163, 147-154

Abstract: This paper revisits fiscal sustainability conditions by relaxing the long-run time-invariance restriction on the parameters commonly imposed in the existing literature. For this purpose, we propose to extend the stock-flow econometric analysis, which bridge the use of government's intertemporal budget constraint as well as a government's fiscal manoeuvre, by allowing time-varying multicointegration. We applied the procedure to the Portuguese case. We found that fiscal practice has taken various directions in this country since the end of the 90s, involving different situations regarding fiscal sustainability.

Keywords: Fiscal policy; Smooth time-varying multicointegration; Stock-flow analysis; Sustainability; Chebyshev time-polynomial (search for similar items in EconPapers)
JEL-codes: C12 C13 C51 C54 E62 (search for similar items in EconPapers)
Date: 2020
References: Add references at CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:cii:cepiie:2020-q3-163-10

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