Discretionary vs nondiscretionary in fiscal mechanism – non-automatic fiscal stabilisers vs automatic fiscal stabilisers

Vasile Brătian, Amelia Bucur, Camelia Oprean-Stan and Cristina Tănăsescu

Economic Research-Ekonomska Istraživanja, 2016, vol. 29, issue 1, 1-17

Abstract: The goal of the present study is to increase the intelligibility of macroeconomic phenomena triggered by governmental intervention in economy by means of fiscal policies. During cyclical movements, fiscal policy can play an important role in order to help stabilise the economy. But discretionary policy usually implies implementation lags and is not automatically reversed when economic conditions change. In contrast, automatic fiscal stabilisers (SFA) ensure a prompter, and self-correcting fiscal response. The present study aims to tackle the topic of discretionary vs nondiscretionary characteristic of fiscal stabilisers (SF). In this context, the scope of the research undertaking is to launch a scientific debate over the definitions of the concepts of non-automatic fiscal stabilisers (SfnA) and SFAs. We describe how we can quantify the discretionary and non-discretionary character of the fiscal policy, by the analysis of the structure of the conventional budget balance (SBc), budget balance associated with the current GDP. In the final part of this article, we propose a quantitative equilibrium model for establishing the mathematical prerequisites for an SF to become automatic. Likewise, on the basis of the proposed mathematical model we have performed a qualitative analysis of the influence factors.

Date: 2016
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/1331677X.2015.1106330 (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Discretionary vs nondiscretionary in fiscal mechanism. Non-automatic fiscal stabilisers vs automatic fiscal stabilisers (2025)
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:taf:reroxx:v:29:y:2016:i:1:p:1-17

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/rero20

DOI: 10.1080/1331677X.2015.1106330

Access Statistics for this article

Economic Research-Ekonomska Istraživanja is currently edited by Marinko Skare

More articles in Economic Research-Ekonomska Istraživanja from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().