5 research outputs found
Fiscal policy, macroeconomic performance and industry structure in a small open economy
We analyse how fiscal policy affects both the macroeconomy and the industry structure, using a multi-sector macroeconomic model of the Norwegian economy with an inflation targeting monetary policy. Our simulations show that the government spending multiplier in the case of a permanent expansionary fiscal policy coupled with a Taylor-type interest rate rule is around 1 over a ten-year horizon. The corresponding labour tax multiplier is about 0.5. These multipliers are somewhat larger in the case of a transitory fiscal stimulus. The government spending multiplier, in the case of either a permanent or a transitory fiscal stimulus, is considerably larger than 1 when monetary policy is made accommodative by keeping the interest rate fixed. Our simulations also show that the industry structure is substantially affected by an expansionary fiscal policy, as value added in the non-traded goods sector increases at the expense of value added in the traded goods sector. The contraction of activity in the traded goods sector increases when monetary tightening accompanies the fiscal stimulus. Hence, we find that such a policy mix is likely to produce significant de-industrialisation in a small open economy with inflation targeting
Fiscal policy, macroeconomic performance and industry structure in a small open economy
We analyse how fiscal policy affects both the macroeconomy and the industry structure, using a multi-sector macroeconomic model of the Norwegian economy with an inflation targeting monetary policy. Our simulations show that the magnitude of the government spending and labour tax cut multipliers, whether monetary policy is active or passive, is comparable to what is found in the literature. A novel finding from our simulations is that the industry structure is substantially affected by an expansionary fiscal policy, as value added in the non-traded goods sector increases at the expense of value added in the traded goods sector. Moreover, expansionary fiscal policy reduces the mark-ups in the traded goods sector, while the mark-ups are roughly unchanged in the non-traded goods sector. The contraction of activity in the traded goods sector increases when monetary tightening accompanies the fiscal stimulus. Hence, we find that such a policy mix is likely to produce significant de-industrialization in a small open economy with inflation targeting.publishedVersio
Oil Windfalls and Regional Economic Performance in Russia
I construct a novel dataset to investigate the effects of oil income in regions of Russia. My data combines regional level data on oil endowments and a wide range of economic series for 85 geographical regions of Russia. Focusing on exogenous oil windfall gains induced by movements in oil prices, I compare outcomes in oil endowed regions to outcomes in other areas. In doing so, I show that oil resources do not seem to benefit regional economic growth. Indeed, I provide evidence that oil windfalls lead to an expansion of the local public sector and a contraction of the private sector, resulting in lower profitability and a decline in economic growth. Overall, my results indicate that only a small share of revenues benefits the local population and that there are signs of missing money
COVID-19, tapt verdiskaping og finanspolitikkens rolle. Utredning for Koronakommisjonen
I denne rapporten sammenligner vi verdiskapingen i en referansebane for perioden 2020-2023 slik
den ser ut i skrivende stund â ved mĂ„nedsskiftet januar/februar 2022 â med SSBs prognose for
norsk Þkonomi publisert i slutten av 2019, altsÄ fÞr pandemien. Forskjellen i verdiskaping mellom de
to banene kan i all hovedsak tilskrives pandemien og samfunnets reaksjon pÄ den, i form av
smitteverntiltak, private aktÞrers respons, myndighetenes Þkonomiske tiltak mv. IfÞlge vÄre
beregninger fÞrte koronapandemien til en reduksjon i BNP for Fastlands-Norge pÄ 214 milliarder
2019-kroner i perioden fra februar 2020 til og med november 2021, som i skrivende stund er siste
mÄned med publiserte nasjonalregnskapstall. I perioden fra desember 2021 til desember 2023
anslÄs det ytterligere reduksjon i verdiskapingen mÄlt ved BNP pÄ grunn av pandemien pÄ rundt 53
milliarder 2019-kroner. Anslaget er usikkert og det er basert pÄ beregninger foretatt av SSB i
Konjunkturtendensene 2021/4, publisert 3. desember 2021.
Samlet beregner vi de totale realÞkonomiske kostnadene av pandemien i perioden 2020-2023 mÄlt
ved lavere BNP til rundt 270 milliarder 2019-kroner, tilsvarende 8,6 prosent av Fastlands-BNP for
2021.
Virkningsberegninger gjort pÄ KVARTS indikerer at finanspolitikken i 2020 og 2021 i noen grad
motvirket fallet i BNP. EkstraordinĂŠre og diskresjonĂŠre tiltak i form av stĂžtteordninger for personer,
foretak og ideell sektor, samt Þkte offentlige bevilgninger, kan anslÄs Ä ha dempet fallet i BNP for
Fastlands-Norge med 0,6 i 2020 og 0,8 prosent i 2021. Anslaget er gjort under en del strenge
antagelser og kan tenkes Ă„ undervurdere effekten noe. Vi har ikke vurdert betydningen av
petroleumsskattepakken.
Reduksjonen i BNP som fĂžlge av pandemien viser bare en del av samlede kostnadene ved
pandemien. Det er flere viktige effekter som ikke fremkommer ved nedgangen i BNP. En viktig effekt
er at sammensetningen av BNP er blitt endret, ved at en del av den vanlige produksjonsaktiviteten
er blitt erstattet av aktivitet med sikte pÄ Ä hÄndtere pandemien og tilpasse aktiviteten til pandemi
og smitteverntiltak. HĂ„ndtering og tilpasning til pandemien har vĂŠrt viktig for Ă„ begrense
skadevirkningene fra pandemien, men det har ikke gitt den samme verdiskaping og velferd som vi
ville fÄtt fra den normale aktiviteten. Et annet moment er at kjÞperne av varer og tjenester normalt
vil verdsette dem hĂžyere enn prisen de betaler, slik at tapet ved at produktet ikke blir produsert vil
vĂŠre stĂžrre enn prisen. Det omtales som tapt konsumentoverskudd og bidrar isolert sett til at det
samfunnsĂžkonomiske tapet er hĂžyere enn BNP-tapet.
Pandemien har ogsÄ mer omfattende skadevirkninger enn det som fÞlger av redusert verdiskaping,
bÄde Þkonomiske og andre samfunnsmessige skadevirkninger som redusert sosial kontakt,
helsetap, redusert lĂŠring mv
Fiscal policy, macroeconomic performance and industry structure in a small open economy
We analyse how fiscal policy affects both the macroeconomy and the industry structure, using a multi-sector macroeconomic model of the Norwegian economy with an inflation targeting monetary policy. Our simulations show that the government spending multiplier in the case of a permanent expansionary fiscal policy coupled with a Taylor-type interest rate rule is around 1 over a ten-year horizon. The corresponding labour tax multiplier is about 0.5. These multipliers are somewhat larger in the case of a transitory fiscal stimulus. The government spending multiplier, in the case of either a permanent or a transitory fiscal stimulus, is considerably larger than 1 when monetary policy is made accommodative by keeping the interest rate fixed. Our simulations also show that the industry structure is substantially affected by an expansionary fiscal policy, as value added in the non-traded goods sector increases at the expense of value added in the traded goods sector. The contraction of activity in the traded goods sector increases when monetary tightening accompanies the fiscal stimulus. Hence, we find that such a policy mix is likely to produce significant de-industrialisation in a small open economy with inflation targeting