Document Type
Conference Item (Restricted)
Publication Date
1-1-2019
Abstract
This paper proposes a Markov-switching model to assess the fiscal adjustments for the period 1990Q1-2018Q3. Our results indicate that the output growth response asymmetry to the change in the budget position only during stable regime. The positive change in the budget position dampens the output growth. It switches from negative effect to positive effect when there is an improvement in the budget position. The role of the fiscal adjustment only a short-run phenomenon and state dependence. However, the uncertainty in the country found temporary increase the output growth, but it is a threat to the country in the long-term.
Keywords
Markov-switching model, output growth, budget, fiscal adjustments, economic growth
Divisions
FacultyofEconomicsAdministration
Event Title
15th International Symposium on Econometric Theory and Applications (SETA) 2019
Event Location
Osaka University, Tokyo, Japan
Event Dates
1-2 June 2019
Event Type
conference
Additional Information
Conference paper