6533b7d3fe1ef96bd126005c

RESEARCH PRODUCT

A competing risks tale on successful and unsuccessful fiscal consolidations

Luca AgnelloRicardo M. SousaRicardo M. SousaVitor CastroVitor Castro

subject

040101 forestryTypologyEconomics and Econometrics050208 financeApplied economics05 social sciencesDuration dependenceSettore SECS-P/02 Politica Economica04 agricultural and veterinary sciencesMonetary economicsFiscal consolidations Discrete duration data Competing risks Multinomial logitCompeting risksConsolidation (business)0502 economics and business8. Economic growthEconomics0401 agriculture forestry and fisheriesFiscal adjustmentFinanceMultinomial logistic regression

description

Abstract This paper analyses the transitions out of fiscal consolidations using annual data for 17 industrial countries over the period 1975-2013 and applying a discrete-time competing risks duration model. Our approach allows us to distinguish the factors behind a successful or an unsuccessful end of fiscal consolidation episodes. The results show that economic and political factors, the size and typology of fiscal adjustments and the occurrence of crises explain the differences in the length and the success/failure of fiscal consolidations. Moreover, while fiscal adjustment programmes that end successfully display positive duration dependence, those that end in an unsuccessful manner are not duration dependent.

yearjournalcountryeditionlanguage
2019-11-01
10.1016/j.intfin.2019.101148http://hdl.handle.net/10447/388281