We analyse the adjustment of public education spending in response to rapidly decreasing student cohorts in East Germany where birth rates collapsed after German reunification. Previous results from the literature based on data from more stable demographic periods suggest that public resources...

Most EU member states will adopt fiscal rules that refer to cyclically-adjusted borrowing limits. Under the standard cyclical adjustment procedure, trend increases in public debt based on cyclical components are prevented if the real-time output gaps used to calculate cyclical components balance...