Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/267594 
Year of Publication: 
2022
Citation: 
[Journal:] Baltic Journal of Economics [ISSN:] 2334-4385 [Volume:] 22 [Issue:] 1 [Publisher:] Taylor & Francis [Place:] London [Year:] 2022 [Pages:] 1-27
Publisher: 
Taylor & Francis, London
Abstract: 
This paper aims to investigate the effects of various fiscal policy measures for small and open economies by analysing the implications of fiscal shocks in the Baltic countries based on data for the period from 1995 to 2018. For this purpose, we have chosen structural VAR estimation methods following Blanchard, O., & Perotti, R. (2002). An Empirical Characterization of the Dynamic Effects of Changes in Government Spending and Taxes on Output. The Quarterly Journal of Economics, 117(4), 1329-1368, approach and relied on local projections for robustness checks. We find that the impact on growth of direct taxes, government consumption and public investment is strong and persistent in the analysed cases. Although the responses of FDI to fiscal shocks are less consistent as compared to output, in most cases, we get strong and persistent negative reactions in FDI to increasing tax burden.
Subjects: 
economic recession
fiscal multipliers
fiscal policy
Fiscal shocks
investment
the Baltic states
JEL: 
E62
H2
H30
H50
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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