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The aim of this paper is to assess the ability of social spending to smooth output shocks and to provide stabilization. The results show that overall social spending is able to smooth about 16 percent of a shock to GDP. Among its subcategories, social spending devoted to Old Age and Unemployment...
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The aim of this paper is to analyze the relation between the volatility of government consumption and country size … countries have more volatile non-discretionary and discretionary government consumption, and also a more volatile government … economies; 3) the relation between government consumption volatility and country size is more negative for functions of …
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consumption and a cut in the wage tax. The results are robust to different parameter calibrations and are economically significant …
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In this working paper, we decompose fiscal policy in three components: i) responsiveness, ii) persistence and iii) discretion. Using a sample of 132 countries, our results point out that fiscal policy tends to be more persistent than responding to output variations. We also found that while the...
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