Impacts of Fiscal Policy Shocks in Finland

Umut Unal

MPRA Paper from University Library of Munich, Germany

Abstract: This paper focuses on the responses of main macroeconomic indicators to the tax and spending shocks in Finland using a structural VAR approach. The results suggest that GDP increases in response to an increase in government spending whereas it falls in response to an increase in total net taxes. The response of investment to both government spending and total net tax shock is consistent with the Keynesian theory. The results also indicate that the relative impact of government spending on output is lower than that of total net taxes.

Keywords: Fiscal Policy; Government Spending; VAR (search for similar items in EconPapers)
JEL-codes: E62 H20 H30 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (1)

Published in The Empirical Economics Letters 13.9(2014): pp. 1017-1024

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:80790

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