While models based on Friedman?s (1957) permanent-income hypothesis can provide oil-producing countries with long-run fiscal targets, they usually abstract from short-run costs associated with consolidation. This paper proposes a model that takes such adjustment costs (or ?habits?) into...

While models based on Friedman's (1957) permanent-income hypothesis can provide oilproducing countries with long-run fiscal targets, they usually abstract from short-run costs associated with consolidation. This paper proposes a model that takes such adjustment costs (or "habits") into account....

While models based on Friedman''s (1957) permanent-income hypothesis can provide oilproducing countries with long-run fiscal targets, they usually abstract from short-run costs associated with consolidation. This paper proposes a model that takes such adjustment costs (or ""habits"") into...

Intro -- Contents -- I. INTRODUCTION -- II. BACKGROUND -- III. THEORETICAL FRAMEWORK -- IV. RESULTS AND SENSITIVITY TESTS -- V. EXTENSIONS -- VI. CONCLUDING REMARKS AND FUTURE RESEARCH AGENDA -- References.

While models based on Friedman's (1957) permanent-income hypothesis can provide oilproducing countries with long-run fiscal targets, they usually abstract from short-run costs associated with consolidation. This paper proposes a model that takes such adjustment costs (or 'habits') into account....