Study of Brazilian fiscal policy: an empirical analysis with the GVAR (1980-2019)

Luccas Assis Attílio

Revista Brasileira de Economia - RBE, 2023, vol. 76, issue 4

Abstract: The expansionary fiscal policy in Brazil in the period 1980Q1-2019Q4 is analyzed with the GVAR. The results show that this policy can stimulate output, however, it deteriorates the macroeconomic environment with increases in prices and interest rates, and exchange rate appreciation. The fluctuations of these variables seem to explain the declines in private consumption and the current account balance. As a result of these fluctuations, the spending multiplier has an average value of 0.1. This work contributes to the literature by incorporating interactions between fiscal and monetary policy, transmission channels, and the external environment and their respective variables.

Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:fgv:epgrbe:v:76:y:2023:i:4:a:84567

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