We examine the relationship between inflation and fiscal sustainability with a two-step approach. In the first step, we … various measures of inflation such as headline inflation, core inflation, energy inflation, and food inflation affect the … estimate of fiscal sustainability found previously. Our findings indicate that higher inflation rates contribute positively to …

policy and public debt. The aim of this paper is to address the challenges posed by the estimation of the discretionary … fiscal reaction function for the Euro area. We exploit recently introduced testing and estimation strategies for …

changes in inflation on fiscal policy. We find evidence of non-linear short-term effects of HICP inflation on the primary … an inflation turning point - beyond which its short-term (contemporaneous) impact on the primary balance starts being … the whole sample of euro area countries in 2022 (EA-19). Using an alternative measure of "inflation surprise" (available …

policy and public debt. The aim of this paper is to address the challenges posed by the estimation of the discretionary … fiscal reaction function for the Euro area. We exploit recently introduced testing and estimation strategies for …