Fiscal Sustainability in the Presence of Systemic Banks: the Case of EU countries

Agnès Benassy-Quere and Guillaume Roussellet

Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) from HAL

Abstract: We provide a first attempt to include off-balance sheet, implicit insurance to SIFIs into a consistent assessment of fiscal sustainability, for 27 countries of the European Union. We first calculate tax gaps à la Blanchard (1990) and Blanchard et al. (1990). We then introduce two alternative measures of implicit off-balance sheet liabilities related to the risk of a systemic bank crisis. The first one relies on microeconomic data at the bank level. The second one is based on econometric estimations of the probability and the cost of a systemic banking crisis. The former approach provides an upper evaluation of the fiscal cost of systemic banking crises, whereas the latter one provides a lower one. Hence we believe that the combined use of these two methodologies helps to gauge the range of fiscal risk.

Keywords: fiscal sustainability; tax gap; systemic banking risk; off-balance sheet liabilities (search for similar items in EconPapers)
Date: 2014-06
New Economics Papers: this item is included in nep-cba
Note: View the original document on HAL open archive server: https://hal.science/hal-00825256v1
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Published in International Tax and Public Finance, 2014, 21 (3), pp.436-467. ⟨10.1007/s10797-013-9273-0⟩

Downloads: (external link)
https://hal.science/hal-00825256v1/document (application/pdf)

Related works:
Journal Article: Fiscal sustainability in the presence of systemic banks: the case of EU countries (2014)
Working Paper: Fiscal Sustainability in the Presence of Systemic Banks: the Case of EU countries (2014)
Working Paper: Fiscal Sustainability in the Presence of Systemic Banks: the Case of EU Countries (2013)
Working Paper: Fiscal Sustainability in the Presence of Systemic Banks: The Case of EU Countries (2012)
Working Paper: Fiscal sustainability in the presence of systemic banks: the case of EU countries (2012)
Working Paper: Fiscal Sustainability in the Presence of Systemic Banks: the Case of EU Countries (2012)
Working Paper: Fiscal Sustainability in the Presence of Systemic Banks: the Case of EU Countries (2012)
Working Paper: Fiscal Sustainability in the Presence of Systemic Banks: the Case of EU Countries (2012)
Working Paper: Fiscal Sustainability in the Presence of Systemic Banks: the Case of EU Countries (2012)
Working Paper: Fiscal Sustainability in the Presence of Systemic Banks: the Case of EU Countries (2012)
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:hal:cesptp:hal-00825256

DOI: 10.1007/s10797-013-9273-0

Access Statistics for this paper

More papers in Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) from HAL
Bibliographic data for series maintained by CCSD ().