Fiscal Policy Responiveness, Persistence and Discretion

We decompose fiscal policy in three components: i) responsiveness, ii) persistence and iii) discretion. Using a sample of 132 countries, our results point out that fiscal policy tends to be more persistent than to respond to output conditions. We also found that while the effect of cross-country covariates is positive (negative) for discretion, it is negative (positive) for persistence thereby suggesting that countries with higher persistence have lower discretion and vice versa. In particular, while government size, country size and income have negative effects on the discretion component of fiscal policy, they tend to increase fiscal policy persistence.Fiscal Policy; Fiscal Volatility.

Fiscal policy responsiveness, persistence and discretion

We decompose fiscal policy in three components: i) responsiveness, ii) persistence and iii) discretion. Using a sample of 132 countries, our results point out that fiscal policy tends to be more persistent than to respond to output conditions. We also found that while the effect of cross-country covariates is positive (negative) for discretion, it is negative (positive) for persistence thereby suggesting that countries with higher persistence have lower discretion and vice versa. In particular, while government size, country size and income have negative effects on the discretion component of fiscal policy, they tend to increase fiscal policy persistence. JEL Classification: E62, H50Fiscal Policy, Fiscal Volatility

Fiscal Policy Discretion, Private Spending, and Crisis Episodes

In this paper, we assess the impact of fiscal policy discretion on economic activity in the short and medium-term. Using a panel of 132 countries from 1960 to 2008, we find that fiscal policy discretion provides a net stimulus to the economy in the short-run and crowding-in effects are amplified once crisis episodes are controlled for– in particular, banking crises - giving a great scope for fiscal policy stimulus packages. However, crowding-out effects take over in the long-run – especially, in the case of debt crises -, in line with the concerns about long-term debt sustainability.Fiscal policy discretion, GDP growth, private consumption, private investment, crowding-in, crowding-out

Assessing Long-Term Fiscal Developments: a New Approach

We use a new approach to assess long-term fiscal developments. By analyzing the timevarying behaviour of the two components of government spending and revenue – responsiveness and persistence – we are able to infer about the sources of fiscal behaviour. Drawing on quarterly data we estimate recursively these components within a system of government revenue and spending equations using a Three-Stage Least Square method. In this way we track fiscal developments, i.e. possible fiscal deteriorations and/or improvements for eight European Union countries plus the US. Results suggest that positions have not significantly changed for Finland, France, Germany, Spain, the United Kingdom and the US, whilst they have improved for Belgium, Italy, and the Netherlands.. KEY Words: Fiscal Deterioration, Fiscal Sustainability

Assessing long-term fiscal developments - a new approach

We use a new approach to assess long-term fiscal developments. By analyzing the time varying behaviour of the two components of government spending and revenue - responsiveness and persistence - we are able to infer about the sources of fiscal behaviour. Drawing on quarterly data we estimate recursively these components within a system of government revenue and spending equations using a Three-Stage Least Square method. In this way we track fiscal developments, i.e. possible fiscal deteriorations and/or improvements for eight European Union countries plus the US. Results suggest that positions have not significantly changed for Finland, France, Germany, Spain, the United Kingdom and the US, whilst they have improved for Belgium, Italy, and the Netherlands. JEL Classification: E62, H50Fiscal Deterioration, Fiscal sustainability

Fiscal policy responsiveness, persistence and discretion

We decompose fiscal policy in three components: i) responsiveness, ii) persistence and iii) discretion. Using a sample of 132 countries, our results point out that fiscal policy tends to be more persistent than to respond to output conditions. We also found that while the effect of cross-country covariates is positive (negative) for discretion, it is negative (positive) for persistence thereby suggesting that countries with higher persistence have lower discretion and vice versa. In particular, while government size, country size and income have negative effects on the discretion component of fiscal policy, they tend to increase fiscal policy persistence

Fiscal policy responsiveness, persistence and discretion

We decompose fiscal policy in three components: i) responsiveness, ii) persistence and iii) discretion. Using a sample of 132 countries, our results point out that fiscal policy tends to be more persistent than to respond to output conditions. We also found that while the effect of cross-country covariates is positive (negative) for discretion, it is negative (positive) for persistence thereby suggesting that countries with higher persistence have lower discretion and vice versa. In particular, while government size, country size and income have negative effects on the discretion component of fiscal policy, they tend to increase fiscal policy persistence

Fiscal policy discretion, private spending, and crisis episodes?

NIPE_WP_31_2011In this paper, we assess the impact of fiscal policy discretion on economic activity in the short and medium-term. Using a panel of 132 countries from 1960 to 2008, we find that fiscal policy discretion provides a net stimulus to the economy in the short-run and crowding-in effects are amplified once crisis episodes are controlled for– in particular, banking crises - giving a great scope for fiscal policy stimulus packages. However, crowding-out effects take over in the long-run – especially, in the case of debt crises -, in line with the concerns about long-term debt sustainability.Fundação para a Ciência e a Tecnologia (FCT

Erythropoietin Selectively Attenuates Cytokine Production and Inflammation in Cerebral Ischemia by Targeting Neuronal Apoptosis

Ischemic brain injury resulting from stroke arises from primary neuronal losses and by inflammatory responses. Previous studies suggest that erythropoietin (EPO) attenuates both processes. Although EPO is clearly antiapoptotic for neurons after experimental stroke, it is unknown whether EPO also directly modulates EPO receptor (EPO-R)–expressing glia, microglia, and other inflammatory cells. In these experiments, we show that recombinant human EPO (rhEPO; 5,000 U/kg body weight, i.p.) markedly reduces astrocyte activation and the recruitment of leukocytes and microglia into an infarction produced by middle cerebral artery occlusion in rats. In addition, ischemia-induced production of the proinflammatory cytokines tumor necrosis factor, interleukin 6, and monocyte chemoattractant protein 1 concentration is reduced by >50% after rhEPO administration. Similar results were also observed in mixed neuronal-glial cocultures exposed to the neuronal-selective toxin trimethyl tin. In contrast, rhEPO did not inhibit cytokine production by astrocyte cultures exposed to neuronal homogenates or modulate the response of human peripheral blood mononuclear cells, rat glial cells, or the brain to lipopolysaccharide. These findings suggest that rhEPO attenuates ischemia-induced inflammation by reducing neuronal death rather than by direct effects upon EPO-R–expressing inflammatory cells