Fiscal regimes in the EU

Antonio Afonso and C. Priscilla Toffano

Working Papers of Department of Economics, Leuven from KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven

Abstract: We assess the existence of fiscal regime shifts in the U.K., Germany, and Italy, using Markov switching fiscal rules. On the basis of a newly built quarterly data set, our results show the existence of fiscal regimes shifts, sometimes coupled with regime switches also regarding monetary developments. While in the UK “active” and “passive” (Leeper, 1991) fiscal regimes are somewhat clearer cut, in Germany fiscal regimes have been overall less active, supporting more fiscal sustainability. For Italy, a more passive fiscal behaviour is uncovered in the run-up to EMU.

Date: 2013-04
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Citations: View citations in EconPapers (7)

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Related works:
Working Paper: Fiscal regimes in the EU (2013)
Working Paper: Fiscal regimes in the EU (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:ete:ceswps:ces13.06

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