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dc.contributor.authorInchauspe, Julian
dc.date.accessioned2021-03-12T06:06:45Z
dc.date.available2021-03-12T06:06:45Z
dc.date.issued2021
dc.identifier.citationInchauspe, J. 2021. Fiscal policy dynamics under a consolidation constraint: evidence from a sign-restricted SVAR with orthogonalized business cycle and monetary policy for Australia. Applied Economics.
dc.identifier.urihttp://hdl.handle.net/20.500.11937/82820
dc.identifier.doi10.1080/00036846.2021.1893894
dc.description.abstract

In this study, I employ a SVAR method that filters out the business cycle and monetary policy to produce conservative but realistic estimates of fiscal responses and multipliers for Australia that are unavailable in the literature. The expenditure and tax multipliers reach a maximum of 0.73 and 0.54, respectively, but their comparison alternates depending on the time horizon. Using a linear combination of fiscal shocks, I construct conjectural variations to analyse the data dynamics and inform policymaking on ways of restoring economic activity post-Covid-19. Importantly, it is demonstrated that a policy that simultaneously increases expenditure and taxes can serve as both a fiscal stimulus and a debt reduction instrument in the medium run, with dynamics subject to a transitory reverse overshooting. This finding is particularly relevant for policymakers that are adverse to increasing public debt with discretionary fiscal measures.

dc.publisherTaylor & Francis
dc.titleFiscal policy dynamics under a consolidation constraint: evidence from a sign-restricted SVAR with orthogonalized business cycle and monetary policy for Australia
dc.typeJournal Article
dcterms.source.issn0003-6846
dcterms.source.titleApplied Economics
dc.date.updated2021-03-12T06:06:45Z
curtin.departmentSchool of Accounting, Economics and Finance
curtin.accessStatusFulltext not available
curtin.facultyFaculty of Business and Law
curtin.contributor.orcidInchauspe, Julian [0000-0002-2300-2223]
curtin.contributor.scopusauthoridInchauspe, Julian [55131349700]


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