We use the time series of shifts in U.S. Federal tax liabilities constructed by Romer and Romer to estimate tax multipliers. Differently from the single-equation approach adopted by Romer and Romer, our estimation strategy (a Var that includes output, government spending and revenues, inflation...

Sustainability can also be assessed in other terms but the size of the accumulated stock of public debt. Even with an indebtedness degree of 20%, budget and fiscal policies may be unsustainable if, for example, that State is unable to pay its obligations arising from the contracted public loans,...

The aim of this study is to present the theoretical background for the concepts of fiscal vulnerability and fiscal sustainability. The distinction between them is very thin and accounts for the time horizon. For assessing the state (vulnerable/sustainable) of fiscal policy, it can be used few...

This paper shows how the richer frequency and variety of fiscal policy shocks available in an international sample can be analyzed recognizing the heterogeneity that exists across different countries. The main conclusion of our empirical analysis is that the question 'what is the fiscal policy...

We examine debt-sensitive majority rules. According to such a rule, the higher a planned public debt, the higher the parliamentary majority required to approve it. In a two-period model we compare debt-sensitive majority rules with the simple majority rule when individuals differ regarding their...

The currently available empirical evidence shows remarkable differences between various estimates of the effects on U.S. output of an exogenous shift in Federal tax liabilities. Shocks identified via the narrative method imply a multiplier of about three over an horizon of three years. Tax...

The fiscal theory of the price level asserts that the price level is determined by the ratio of outstanding public nominal debt into the present value of real primary budget surpluses of the government. We here argue that the logic of the fiscal theory fails when at least part of the public debt...

This paper analyzes the relationship between fiscal policy and the macroeconomic indicators (economic growth, inflation rate, unemployment rate, public debt) in the case of Romania for the period 1990-2007. The correlations between these variables are tested by applying the regression technique,...

A shift in taxes or in government spending (a ”fiscal shock”) at some point in time puts a constraint on the path of taxes and spending in the future, since the government intertemporal budget constraint will eventually have to be met. This simple fact is surprisingly overlooked in analyses...

The study discusses the issue of fulfillment by Poland of the so-called fiscal convergence criteria, concerning public debt and public deficit, based on the regulations of the European and Polish financial laws, as well as in the context of their economic character.