This paper discusses an alternative route to a balanced budget, namely through debt control. Two models are compared: the debt brake which has been used in Switzerland since 2003 and the debt limitation model proposed by Compact for America. The paper concludes that the former, while apparently...

We use a panel of 155 countries for 1970-2010 to study (two-way) causality between government spending, revenue and growth. Our results suggest the existence of weak evidence supporting causality from expenditures or revenues to GDP per capita and provide evidence supporting Wagner's Law

We analyze the short and long run effects of demographic ageing - increased longevity and reduced fertility - on per-capita growth. The OLG model captures direct effects, working through adjustments in the savings rate, labor supply, and capital deepening, and indirect effects, working through...

Many economic studies analyse the impact of fiscal rules and discuss their effectiveness in limiting excessive debt. A majority of these studies, however, neglects or only deals insufficiently with the potential issue of endogeneity. In this paper, we propose a novel identification approach...

We study the loss function of 15 European governments as implied by their budget balance forecasts. Results suggest that the shape of the loss function varies across countries. The loss function becomes more asymmetric as the forecast horizon increases and in advance of parliamentary election....

We implement a meta-regression-analysis for the budgetary impact of numerical fiscal rules. Based on 30 studies published in the last decade, we offer a consensus estimate with respect to the level of statistical significance, provide suggestive evidence for the effect size, and identify study...

We analyze the short and long run effects of demographic ageing - increased longevity and reduced fertility - on per-capita growth. The OLG model captures direct effects, working through adjustments in the savings rate, labor supply, and capital deepening, and indirect effects, working through...

The article aims to provide a new approach to the modelling of fiscal policy effectiveness in Azerbaijan. It is argued that massive transfer of oil revenues from SOFAZ to state budget after 2008 has sharply declined the impact of budget expenditures over non-oil sector economic performance, so...

We apply non-linear error-correction models to the empirical testing of the sustainability of the government’s intertemporal budget constraint. Our empirical analysis, based on Italy, shows that the Italian government is meeting its intertemporal budget constraint, in spite of the high levels...

In this paper we review the linkages between the quality of public finances, that is, the level and composition of public expenditure and its financing via revenue and deficits, and economic growth. We review the various channels through which public finances affect growth and its underlying...