Fiscal and Monetary Policy of Economic Development

Actual Budget Deficit = Cyclic Budget Deficit (as effect of the action of automatic stabilizers) + Structural Budget Deficit (result of the discretionary fiscal policy)

The literature on optimal taxation focuses on the effects of fiscal policy on economic growth although, there are also several studies that focus on the impact on other

Following this line of objective, the present work seeks: • to study the effects, in terms of optimality, of three policy regimes which commonly arise between the fiscal and

Having identified monetary policy shocks and demand shocks, and restricted the covariance matrix of the reduced-form residuals using the contemporaneous causal order suggested by

In fiscal terms, primary balance followed the expected behaviour, by reacting positively to increases in government debt, and the reaction function for

However one particular strand of the political economy has lately shed some light on the relationship between fiscal policy and its effects on economic growth by

Credit-constrained agents have less elastic labor supply re- sponses to fiscal consolidation achieved through either tax hikes or public spending cuts, and this explains

Hence, it is critical to establish how government spending shocks influence not only output and prices but also indicators of fiscal sustainability such as the debt-to-GDP ratio and