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De Facto Fiscal Space and Fiscal Stimulus : Definition and Assessment

Aizenman, Joshua - 2010

We define the notion of a 'de facto fiscal space' of a country as the inverse of the tax-years it would take to repay the public debt. Specifically, we measure the outstanding public debt relative to the de facto tax base, where the latter measures the realized tax collection, averaged across...

Persistent link: https://www.econbiz.de/10013135878

Business Cycle Durations and Postwar Stabilization of the U.S. Economy

Watson, Mark W. - 2021

The average length of business cycle contractions in the United States fell from 20.5 months in the prewar period to 10.7 months in the postwar period. Similarly, the average length of business cycle expansions rose from 25.3 months in the prewar period to 49.9 months in the postwar period. This...

Persistent link: https://www.econbiz.de/10013223887

Understanding the Great Depression : Lessons for Current Policy

Cecchetti, Stephen G. - 2021

Over the four years beginning in the summer of 1929, financial markets, labor markets and goods markets all virtually ceased to function. Throughout this, the government policymaking apparatus seemed helpless. Since the end of the Great Depression, macroeconomists have labored diligently in an...

Persistent link: https://www.econbiz.de/10013224184

Reconciling Hayek'S and Keynes Views of Recessions

Beaudry, Paul; Galizia, Dana; Portier, Franck - 2021

Recessions often happen after periods of rapid accumulation of houses, consumer durables and business capital. This observation has led some economists, most notably Friedrich Hayek, to conclude that recessions mainly reflect periods of needed liquidation resulting from past over-investment....

Persistent link: https://www.econbiz.de/10013224999

The Business Cycles of Balance-of-Payment Crises : a Revision of Mundellan Framework

Mendoza, Enrique G.; Uribe, Martín - 2021

In his seminal 1960 article Robert Mundell proposed a model of balance-of-payments crises in which confidence in the continuation of a currency peg depended on the observed holdings of central bank foreign reserves. We examine the implications of a reformulation of this view from the perspective...

Persistent link: https://www.econbiz.de/10013235602

The Role for Discretionary Fiscal Policy in a Low Interest Rate Environment

Feldstein, Martin S. - 2021

Although there is now widespread agreement in the economics profession that discretionary counter-cyclical'fiscal policy has not contributed to economic stability and may have actually been destabilizing at particular times in the past, there is one important condition when discretionary fiscal...

Persistent link: https://www.econbiz.de/10013245697

Disasters Everywhere : The Costs of Business Cycles Reconsidered

Jordà, Òscar; Schularick, Moritz; Taylor, Alan M. - 2022

Business cycles are costlier and stabilization policies could be more beneficial than widely thought. This paper introduces a new test to show that all business cycles are asymmetric and resemble “mini-disasters.” By this we mean that growth is pervasively fat-tailed and non-Gaussian. Using...

Persistent link: https://www.econbiz.de/10013298491

What Ends Recessions?

Romer, Christina D.; Romer, David H. - 2022

This paper analyzes the contributions of monetary and fiscal policy to postwar economic recoveries. We find that the Federal Reserve typically responds to downturns with prompt and large reductions in interest rates. Discretionary fiscal policy, in contrast, rarely reacts before the trough in...

Persistent link: https://www.econbiz.de/10013309225

The Cost of Business Cycles and the Benefits of Stabilization : A Survey

Barlevy, Gadi - 2021

This article reviews the literature on the cost of U.S. post-War business cycle fluctuations. I argue that recent work has established this cost is considerably larger than initial work found. However, despite the large cost of macroeconomic volatility, it is not obvious that policymakers should...

Persistent link: https://www.econbiz.de/10013229013

Is Poland at Risk of a Boom-and-Bust Cycle in the Run-Up to Euro Adoption?

Eichengreen, Barry - 2008

We ask whether Poland is at risk of the boom-bust problem that has afflicted economies around the time of euro adoption …. Our answer, inevitably, is mixed. On the one hand the fact that Poland is an outlier, credit-growth wise, accentuates the … Poland. And it is certainly conceivable that the same policies and country characteristics (not always visible to the …

Persistent link: https://www.econbiz.de/10012769529

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