Modelling the fiscal reaction functions of the GIPS based on state-varying thresholds

Gabriella Legrenzi () and Costas Milas

Economics Letters, 2013, vol. 121, issue 3, 384-389

Abstract: We introduce non-linear fiscal reaction functions with endogenously estimated state-varying thresholds to capture the behaviour of fiscal policy authorities during “good” and “bad” times. These thresholds vary with the level of debt, the economic cycle and a financial pressure index.

Keywords: Debt sustainability; Fiscal reaction function; State-varying threshold (search for similar items in EconPapers)
JEL-codes: C2 H3 H5 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (32)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0165176513004187
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Modelling the Fiscal Reaction Functions of the GIPS Based on State-Varying Thresholds (2013)
Working Paper: Modelling the Fiscal Reaction Functions of the GIPS based on State-Varying Thresholds (2013)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:121:y:2013:i:3:p:384-389

DOI: 10.1016/j.econlet.2013.09.011

Access Statistics for this article

Economics Letters is currently edited by Economics Letters Editorial Office

More articles in Economics Letters from Elsevier
Bibliographic data for series maintained by Catherine Liu ().