Long Term Eff ects of Fiscal Policy on the Size and the Distribution of the Pie in the UK

This paper provides a joint analysis of the output and distributional long term effects of various fiscal policies in the UK, using a Vector Autoregression approach. Our findings suggest that the output effects of fiscal policies are consistent with the Keynesian paradigm for both direct and indirect taxes but not for public spending. The estimated long term impact on GDP of increasing all type of expenditure and taxes analysed is negative and especially strong in the case of current expenditure. We also find significant distributional effects associated to fiscal policies, indicating that an increase in public spending and direct taxes reduces inequality while a raise in indirect taxes increases income inequality. Finally, the relationship between inequality and output is also explored

Impacto a corto plazo de los fondos objetivo 2 del Feder en España

Infraestructuras, Efectos demanda, Análisis input-output, Fondos estructurales

Public infrastructure and regional asymmetries in Spain

L?objectif de cet article est d?analyser les effets économiques des infrastructures publiques en Espagne. Les résultats empiriques s?appuient sur des modèles VAR concernant l?output, l?emploi, le capital privé, et les infrastructures publiques. Nous estimons des modèles agrégés et des modèles régionaux pour les 17 régions espagnoles. En ce qui concerne les modèles régionaux, nous avons inclus les infrastructures publiques construites dans la région et aussi celles mises en place dans le reste du pays, afin de prendre en considération l?existence éventuelle des effets spillovers. Les résultats montrent, d?une part, l?importance des effets spillovers entre régions, et, d?autre part, l?augmentation des déséquilibres régionaux, bien que les infrastructures aient constitué un instrument très fort pour promouvoir la croissance économique à long terme. On peut en conclure que le processus de convergence de l?économie espagnole vers les standards de l?UE a supposé l?augmentation des asymétries en Espagne.public infrastructure, regional spillovers, regional asymmetries, infrastructure publique, spillovers, asymétries régionales

On the Effects of Fiscal Policies in Portugal

This paper estimates the long-term effects on output of different fiscal policies in Portugal in the context of unrestricted VAR models that include several public spending and taxation variables. Empirical results suggest that the effects of fiscal policies are within the Keynesian paradigm for public transfers, public consumption, public investment and direct taxation, with public investment showing particularly strong positive effects and direct taxation showing particularly strong negative effects. In turn, non-Keynesian effects dominate in the case of public wages where cuts are expansionary and indirect taxation where raises are neutral. Accordingly, cuts in public wages and raises in indirect taxations are the two most desirable instruments for fiscal consolidation in Portugal. Finally, deficit-neutral policies that offset raises in public transfers, public consumption, and public investment, with raises in indirect taxes have long-term positive effects on output. The same is true for cuts in direct taxation offset with cuts in all forms of public spending except for public investment.policy, budgetary restraint, fiscal consolidation