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ifo Institut – Leibniz-Institut für Wirtschaftsforschung an der Universität München >
CESifo Working Papers, CESifo Group Munich >
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http://hdl.handle.net/10419/18763
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| Title: | | Sustainability of Portuguese fiscal policy in historical perspective  |
| Authors: | | Marinheiro, Carlos Jose Fonseca |
| Issue Date: | | 2005 |
| Series/Report no.: | | CESifo working papers 1399 |
| Abstract: | | This paper analyses the sustainability of Portuguese public finances, making use of a long dataset with more than a full century of observations. The use of such a long dataset is appropriate because both unit root and cointegration tests require a long period of data. The sustainability testing procedure is based on unit root and cointegration tests. We find considerable evidence in favour of sustainability for the 1903-2003 period. The overall conclusion of sustainability for the 1903-2003 period is not maintained for the more recent 1975-2003 period, which is characterised by the largest GDP deficit ratios of our sample. This latter period appears to signal a shift to an unsustainable path in Portuguese fiscal policy. Hence, our results suggest that fiscal consolidation efforts must, in fact, be continued in Portugal. |
| Subjects: | | fiscal sustainability sustainability of public debt intertemporal budget constraint government deficits and debt Portugal |
| JEL: | | H60 E60 |
| Document Type: | | Working Paper |
| Appears in Collections: | | CESifo Working Papers, CESifo Group Munich
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