Fiscal Multipliers for Brazil

Troy Matheson () and Joana Pereira

No 2016/079, IMF Working Papers from International Monetary Fund

Abstract: We find historical fiscal multipliers for Brazil around 0.5, larger than what existing literature typically identifies for the average emerging market. However, spending and public credit multipliers seem to have dropped to near zero since the global financial crisis, as the estimate for the whole sample period (1999-2014) is about ½ of that for precrisis years. By contrast, revenue multipliers have remained broadly stable. We conclude that fiscal consolidations based on expenditure and public credit retrenchment are likely to entail a modest drag on growth in the near term.

Keywords: WP; revenue; Fiscal policy; fiscal multipliers; public credit; credit multiplier; credit shock; spending increase; expenditure series; revenue multiplier; Policy lending; credit supply; discretionary spending; credit increase; Credit; State-owned banks; Global (search for similar items in EconPapers)
Pages: 16
Date: 2016-03-25
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Citations: View citations in EconPapers (14)

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