The Behavior of U.S. Deficits

Robert Barro

No 1309, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The tax-smoothing theory suggests that deficits would respond particularly to recession, temporarily high government spending, and anticipated inflation. My empirical estimates indicate that a relation of this type is reasonably stable in the U.S. since at least 1920. In particular, the statistical evidence does not support the idea that there has been a shift toward a fiscal policy that generates either more real public debt on average or that generates larger deficits in response to recessions. Further, the deficits for 1982-83 and projections for 1984 are consistent with the previous structure. The high values of these deficits reflect the customary response to substantial recession (interacting with big government) and to expected inflation.

Date: 1984-03
Note: EFG
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Published as Gordon, Robert J. (ed.) The American Business Cycle: Continuity and Change. Chicago: University of Chicago Press, 1986.
Published as Barro, Robert J. "U.S. Deficits Since World War I." Scandinavian Journal of Economics, Vol. 88, No. 1, (1986), pp. 195-222.

Downloads: (external link)
http://www.nber.org/papers/w1309.pdf (application/pdf)

Related works:
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:nbr:nberwo:1309

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w1309

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by (wpc@nber.org).