Public finances and inflation: the case of Spain
Pablo Hernández de Cos,
Samuel Hurtado (),
Francisco Martí () and
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Francisco Martí: Banco de España
No 1606, Occasional Papers from Banco de España
We empirically explore the influence of inflation on fiscal variables in the short, medium and long run, for the case of the Spanish economy, in particular to draw policy lessons for the design of the ongoing process of rebalancing of fiscal accounts. We focus on this topic through the lenses of: (i) the government budget constraint, to assess the influence of inflation on changes in public debt; (ii) accounting decompositions of nominal revenue and expenditure items into their real and price parts; (iii) a large-scale macroeconometric model that contains a detailed fiscal policy block; and (iv) a long-run accounting model on pension expenditure
Keywords: inflation; public finances; public debt; fiscal consolidation (search for similar items in EconPapers)
JEL-codes: E31 E62 H6 (search for similar items in EconPapers)
Pages: 28 pages
New Economics Papers: this item is included in nep-age, nep-cba, nep-eec, nep-mac and nep-pbe
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Persistent link: https://EconPapers.repec.org/RePEc:bde:opaper:1606
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