Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/72379
Authors: 
Hogan, Vincent
Year of Publication: 
2003
Series/Report no.: 
Working Paper Series, UCD Centre for Economic Research 03/03
Abstract: 
We examine the ability of the Expansionary Fiscal Contraction (EFC) hypothesis to explain the performance of of OECD economies during times of crisis. We find some limited evidence in its favour: if public consumption is reduced in response to a fiscal crisis (as defined by a high level of debt), private consumption does seem to increase. However the size of the effect is smaller than that typically found in similar studies. Furthermore, the increase in private consumption is not usually sufficient to offset the direct effect of a reduction in the public consumption on output{ fiscal contractions are not literally expansionary.
Subjects: 
Consumption
Saving
Fiscal Policy
JEL: 
E21
E62
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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