REAL

Impact of public debt sustainability on fiscal policy in Croatia

Šimović, Hrvoje (2018) Impact of public debt sustainability on fiscal policy in Croatia. Acta Oeconomica, 68 (2). pp. 231-244. ISSN 0001-6373

[img]
Preview
Text
032.2018.68.2.3.pdf

Download (263kB) | Preview

Abstract

This paper analyses the impact of public debt level and its (un)sustainability on fiscal policy in Croatia in the 2001–2015 period. A switching regression approach is used to distinguish different regimes when government spending, i.e. fiscal policy has more or less impact on economic growth during different cycles. In the second part, the structural VAR model is used to analyse the dynamic effects of government spending on domestic demand in Croatia. To observe the public debt effects on a fiscal policy, a “closed” model is compared with an “extended” model which includes a debtto- GDP indicator. Results show a negative impact of recession on public debt sustainability and confirm the main thesis that public debt level significantly affects and reduces the effectiveness of fiscal policy in Croatia.

Item Type: Article
Subjects: H Social Sciences / társadalomtudományok > H Social Sciences (General) / társadalomtudomány általában
Depositing User: Eszter Bálint
Date Deposited: 18 Jun 2018 08:32
Last Modified: 30 Jun 2020 23:16
URI: http://real.mtak.hu/id/eprint/80604

Actions (login required)

Edit Item Edit Item