The Distributional Effects of Fiscal Consolidation

The Distributional Effects of Fiscal Consolidation

This paper examines the distributional effects of fiscal consolidation. Using episodes of fiscal consolidation for a sample of 17 OECD countries over the period 1978-2009, we find that fiscal consolidation has typically had significant distributional effects by raising inequality, decreasing wage in...

Ausführliche Beschreibung

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Bibliographische Detailangaben
Hauptverfasser: Ball, Laurence M, Furceri, Davide, Leigh, Daniel
Format: Buch
Sprache:eng
Schlagworte:
Economic stabilization
Fiscal policy
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Beschreibung
Zusammenfassung:This paper examines the distributional effects of fiscal consolidation. Using episodes of fiscal consolidation for a sample of 17 OECD countries over the period 1978-2009, we find that fiscal consolidation has typically had significant distributional effects by raising inequality, decreasing wage income shares and increasing long-term unemployment. The evidence also suggests that spending-based adjustments have had, on average, larger distributional effects than tax-based adjustments.