FISCAL MULTIPLIERS IN THE SLOVAK ECONOMY: DSGE SIMULATION

• Authors: Zeman Juraj
• Languages of publication: EN

Abstracts

EN

In order to calculate fiscal multipliers for Slovakia, the author uses a small open DSGE model of Slovakia constructed by Zeman and Senaj (2009) that is augmented by a more sophisticated fiscal sector, which comprises government expenditure components (consumption, investment and social transfers to liquidity-constrained households), as well as government revenue components (personal income taxes, employer social contributions, VAT (value-added tax) and a lump-sum tax). The Slovak government has laid out a plan of public finance consolidation for the period from 2013 to 2017 in order to meet the Fiscal Compact criteria. According to the fiscal multipliers calculated in this paper, the consolidation will cause an aggregate loss of 3.1% of GDP during this period, which turns out to be a more precise estimate than official government projections.

Keywords

EN

FISCAL MULTIPLIERS; EXPENDITURE; REVENUE; DSGE SIMULATIONS; SLOVAKIA

• Publisher: Institute of Slovak and World Economics and Institute for Forecasting, Slovak Academy of Sciences
• Journal: Ekonomický časopis (Journal of Economics)
• Year: 2017
• Volume: 65
• Issue: 6
• Pages: 505 – 519

Contributors

author

Zeman Juraj

• National Bank of Slovakia, Imricha Karvaša 1, 813 25 Bratislava, Slovak Republic