Purpose – The purpose of this paper is to explain how eventual pressures from national lobbies may lead governments to shift from an optimal into a non‐optimal innovation policy. Design/methodology/approach – A theoretical model is developed in order to examine and explain the growth and...

The assignment of targets to instruments in developing countries cannot satisfactorily follow any simple universal rule. Which approach is appropriate is influenced by whether the economy is dominated by primary exports, by the importance of the domestic bond market and bank credit, by the...

Purpose The purpose of this paper is to investigate whether fiscal policy may be a complementary instrument to monetary policy in the macrostabilization process. Design/methodology/approach The authors developed a dynamic system with two linear differential equations in order to verify if an...

Purpose – The purpose of this paper is to test the effects of unanticipated fiscal policy shocks on the growth rate and the cyclical component of real private output and reveal different types of asymmetries in fiscal policy implementation. Design/methodology/approach – The authors use two...

Purpose – The purpose of this paper is to contribute to the literature on the determinant factors of government budget balance forecast errors for Eurozone countries based on four different database sources from 1998 to 2011. Design/methodology/approach – Besides the analysis on quality and...

Purpose – The purpose of this paper is to show that economic policy impacts sovereign debt risk in addition to economic performance. Design/methodology/approach – Regression analysis was employed to determine the factors that contribute to sovereign bond ratings and bond spreads for a sample...

Purpose – The purpose of this paper is to study the short‐term macroeconomic effects of the fiscal policy in Colombia for the 1980‐2007 period using a structural vector autoregression (SVAR) model. Design/methodology/approach – The authors' benchmark is a five‐variable SVAR model which...

Purpose – The purpose of this paper is to determine if the US Treasury's at‐the‐market sales of 5.27 billion Citigroup shares in 2010 drove down the banks' share price. It attempts to use the evidence of Citigroup's stock returns to accept or reject competing hypotheses of larger stock...

Purpose – The purpose of this paper is to assess the suitability of adopting inflation targeting in an emerging market, based on the pre‐conditions of inflation targeting identified in the literature. Design/methodology/approach – The study uses Granger causality and VAR approaches to...

Purpose – The purpose of this paper is to show that state economic policies, in addition to state economic performance, impact state bond ratings. Design/methodology/approach – Using a sample of 39 states over the period 1998‐2008, regression analysis is employed to determine whether...