Do Fiscal Spillovers Matter?
Do Fiscal Spillovers Matter?

Author: Anna Ivanova

Publisher: International Monetary Fund

Published: 2011-09-01

Total Pages: 45

ISBN-13: 146390231X

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The paper assesses the impact of fiscal spillovers on growth in the context of a coordinated exit from crisis management policies. We find that despite potentially sizeable domestic effects from consolidation, aggregate negative spillovers to other countries are likely to be contained in 2011-2012 unless fiscal multipliers and/or imports elasticities are very large. Small and open European economies, however, will be substantially affected in any case. In contrast, the coordinated exit from fiscal stimulus will have limited direct effect on European peripheral countries since they are relatively closed, with the notable exception of Ireland.

License to Spill: How Do We Discuss Spillovers in Article IV Staff Reports
License to Spill: How Do We Discuss Spillovers in Article IV Staff Reports

Author: Jelle Barkema

Publisher: International Monetary Fund

Published: 2021-05-07

Total Pages: 25

ISBN-13: 1513573675

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This paper dives into the Fund’s historical coverage of cross-border spillovers in its surveillance. We use a state-of-the-art deep learning model to analyze the discussion of spillovers in all IMF Article IV staff reports between 2010 and 2019. We find that overall, while the discussion of spillovers decreased over time, it was pronounced in the staff reports of some systemically important economies and during periods of global spillover events. Spillover discussions were more prominent in staff reports covering advanced and emerging market economies, possibly reflecting their role as sources of global spillovers. The coverage of spillovers was higher in the context of the real, financial, and external sectors. Also, countries with larger economies, higher trade and capital account openess and lower inflation are more likely to discuss spillovers in their Article IV staff reports.

How Big (Small?) are Fiscal Multipliers?
How Big (Small?) are Fiscal Multipliers?

Author: Ethan Ilzetzki

Publisher: International Monetary Fund

Published: 2011-03-01

Total Pages: 68

ISBN-13: 1455218022

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We contribute to the intense debate on the real effects of fiscal stimuli by showing that the impact of government expenditure shocks depends crucially on key country characteristics, such as the level of development, exchange rate regime, openness to trade, and public indebtedness. Based on a novel quarterly dataset of government expenditure in 44 countries, we find that (i) the output effect of an increase in government consumption is larger in industrial than in developing countries, (ii) the fisscal multiplier is relatively large in economies operating under predetermined exchange rate but zero in economies operating under flexible exchange rates; (iii) fiscal multipliers in open economies are lower than in closed economies and (iv) fiscal multipliers in high-debt countries are also zero.

Growth Forecast Errors and Fiscal Multipliers
Growth Forecast Errors and Fiscal Multipliers

Author: Mr.Olivier J. Blanchard

Publisher: International Monetary Fund

Published: 2013-01-03

Total Pages: 43

ISBN-13: 1475576447

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This paper investigates the relation between growth forecast errors and planned fiscal consolidation during the crisis. We find that, in advanced economies, stronger planned fiscal consolidation has been associated with lower growth than expected, with the relation being particularly strong, both statistically and economically, early in the crisis. A natural interpretation is that fiscal multipliers were substantially higher than implicitly assumed by forecasters. The weaker relation in more recent years may reflect in part learning by forecasters and in part smaller multipliers than in the early years of the crisis.

Policy and Choice
Policy and Choice

Author: William J. Congdon

Publisher: Brookings Institution Press

Published: 2011

Total Pages: 260

ISBN-13: 0815704984

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Argues that public finance--the study of the government's role in economics--should incorporate principles from behavior economics and other branches of psychology.

Fiscal Politics
Fiscal Politics

Author: Vitor Gaspar

Publisher: International Monetary Fund

Published: 2017-04-07

Total Pages: 548

ISBN-13: 1475547900

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Two main themes of the book are that (1) politics can distort optimal fiscal policy through elections and through political fragmentation, and (2) rules and institutions can attenuate the negative effects of this dynamic. The book has three parts: part 1 (9 chapters) outlines the problems; part 2 (6 chapters) outlines how institutions and fiscal rules can offer solutions; and part 3 (4 chapters) discusses how multilevel governance frameworks can help.

Germany In An Interconnected World Economy
Germany In An Interconnected World Economy

Author: Mr.Ashoka Mody

Publisher: International Monetary Fund

Published: 2013-04-10

Total Pages: 280

ISBN-13: 1616354240

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Germany has been a central player in discussions on the future architecture of Europe, and has been called on to play a larger role in supporting global and, especially, European recovery from the financial crisis that triggered the Great Recession. This book focuses on the possible economic role of Germany and shows that the quantitative effects of a German fiscal stimulus would be small on the heavily indebted euro area periphery countries that most need the boost. The book finds that Germany itself faces a growth challenge and that efforts to raise its own growth potential are important for Germany, and that more rapid growth of domestic demand will more powerfully stimulate European economic growth through its expanded demand for imports.

Germany
Germany

Author: International Monetary Fund

Publisher: International Monetary Fund

Published: 2012-07-03

Total Pages: 64

ISBN-13: 1475561555

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This 2012 Article IV Consultation reports that the German economy’s performance has been remarkable despite facing considerable headwinds. Several conditions are now in place in Germany for a domestic demand-led recovery. Employment creation has been robust and unemployment at 5.3 percent is at a postreunification low. Executive Directors have commended Germany’s strong macroeconomic management, which has resulted in a favorable economic performance despite the uncertain external environment. Directors have underscored Germany’s pivotal role in reducing euro area and global imbalances.

Belgium
Belgium

Author: International Monetary Fund

Publisher: International Monetary Fund

Published: 2012-03-20

Total Pages: 56

ISBN-13: 1475502397

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This Selected Issues Paper on Belgium provides an overview of the extent of trade and financial openness of Belgium and the links to particular countries. With an export-to-GDP ratio of 79 percent, Belgium belongs to the most open economies in Europe and also globally. Its exports are highly concentrated with a share of three-fourths of total merchandise exports accounted for by the European Union, of which close to two-thirds go to Germany, France, and the Netherlands.