Access the full text.
Sign up today, get DeepDyve free for 14 days.
P. Agénor (2002)
Business Cycles, Economic Crises, and the PoorThe Journal of Policy Reform, 5
Neil Ericsson, D. Hendry, G. Mizon (1998)
Exogeneity, Cointegration, and Economic Policy AnalysisEconometrics eJournal
A. Alesina, Roberto Perotti (1995)
Fiscal Expansions and Adjustments in OECD EconomiesEconomic Policy, 21
N. Lustig, C. Pessino, John Scott (2014)
The Impact of Taxes and Social Spending on Inequality and Poverty in Argentina, Bolivia, Brazil, Mexico, Peru, and Uruguay: Introduction to the Special IssuePublic Finance Review, 42
A. Atkinson, A. Brandolini (2001)
Promise and Pitfalls in the Use of "Secondary" Data-Sets: Income Inequality in OECD Countries As a Case StudyJournal of Economic Literature, 39
C. McDermott, Robert Wescott (1996)
An Empirical Analysis of Fiscal AdjustmentsS&P Global Market Intelligence Research Paper Series
Nathaniel Beck, Jonathan Katz (1995)
What To Do (and Not to Do) with Time-Series Cross-Section DataAmerican Political Science Review, 89
P. Devries, Jaime Guajardo, D. Leigh, Andrea Pescatori (2011)
A New Action-Based Dataset of Fiscal ConsolidationERN: National
Iris Claus, J. Martínez-Vázquez, V. Vulovic (2013)
Coping with Rising Inequality in Asia: How Effective Are Fiscal Policies?*Asian Economic Papers, 12
Ò. Jordà (2005)
Estimation and Inference of Impulse Responses by Local ProjectionsThe American Economic Review, 95
(2010)
Large Changes in Fiscal Policy: Taxes Versus Spending
Xiaoming Cai, Wouter Haan (2009)
Predicting Recoveries and the Importance of Using Enough InformationInternational Finance
A. Coudouel, S. Paternostro (2006)
Analyzing the Distributional Impact of Reforms : A Practitioner’s Guide to Pension, Health, Labor Markets, Public Sector Downsizing, Taxation, Decentralization, and Macroeconomic Modeling, Volume 2World Bank Publications
K. Im, M. Pesaran, Y. Shin (2003)
Testing for unit roots in heterogeneous panelsJournal of Econometrics, 115
Jaejoon Woo, E. Bova, Tidiane Kinda, Y. Zhang (2013)
Distributional Consequences of Fiscal Consolidation and the Role of Fiscal Policy: What Do the Data Say?ERN: Fiscal & Monetary Policy in Developing Economies (Topic)
Pablo Cos, Enrique Moral-Benito (2013)
Fiscal Consolidations and Economic GrowthFiscal Studies, 34
L. Agnello, Ricardo Sousa (2012)
Fiscal adjustments and income inequality: a first assessmentApplied Economics Letters, 19
N. Gemmell, O. Morrissey (2005)
Distribution and Poverty Impacts of Tax Structure Reform in Developing Countries: How Little We KnowDevelopment Policy Review, 23
S. Nickell (1981)
Biases in Dynamic Models with Fixed EffectsEconometrica, 49
Leonel Muinelo‐Gallo, Oriol Roca‐Sagalés (2011)
Economic Growth and Inequality: The Role of Fiscal PoliciesMacroeconomics: Monetary & Fiscal Policies eJournal
A. Alesina, Silvia Ardagna (1998)
Tales of Fiscal AdjustmentEconomic Policy, 13
Serhan Cevik, Carolina Correa-Caro (2015)
Growing (un)equal: fiscal policy and income inequality in China and BRIC+Journal of the Asia Pacific Economy, 25
L. Agnello, Ricardo Sousa (2012)
How Does Fiscal Consolidation Impact on Income Inequality?PSN: Income Inequality (Topic)
Valerie Cerra, S. Saxena (2005)
Growth Dynamics: The Myth of Economic RecoveryInternational Monetary Fund (IMF) Research Paper Series
H. Davoodi, S. Gupta, Ke-young Chu (2000)
Income Distribution and Tax and Government Social Spending Policies in Developing CountriesEmerging Markets: Finance
(2000)
Searching for Non-Linear Effects of Fiscal Policy: Evidence from Industrial and Developing Countries
A. Alesina, Roberto Perotti (1993)
Income Distribution, Political Instability, and InvestmentPolitical Economy - Development: Political Institutions eJournal
Carlos Mulas-Granados (2005)
Fiscal Adjustments and the Short-Term Trade-Off between economic growth and equalityHacienda Publica Espanola, 172
Boris Cournéde, Antoine Goujard, Álvaro Pina (2013)
How to Achieve Growth- and Equity-Friendly Fiscal Consolidation? A Proposed Methodology for Instrument Choice with an Illustrative Application to OECD CountriesPolitical Economy: Budget
M. Odedokun, J. Round (2004)
Determinants of Income Inequality and its Effects on Economic Growth
G. Maddala, Shaowen Wu (1999)
A Comparative Study of Unit Root Tests with Panel Data and a New Simple TestOxford Bulletin of Economics and Statistics, 61
Antonio Fatás, I. Mihov (2005)
Policy Volatility, Institutions, and Economic GrowthReview of Economics and Statistics, 95
António Afonso, J. Jalles (2011)
Assessing Fiscal EpisodesPSN: Fiscal & Monetary Policy (Comparative) (Topic)
Jaime Guajardo, D. Leigh, Andrea Pescatori (2014)
EXPANSIONARY AUSTERITY? INTERNATIONAL EVIDENCEJournal of the European Economic Association, 12
C. Granger, T. Teräsvirta (1995)
Modelling Nonlinear Economic Relationships
F. Giavazzi, M. Pagano (1995)
Non-Keynesian Effects of Fiscal Policy Changes: International Evidence and the Swedish ExperienceEuropean Economics: Political Economy & Public Economics eJournal
S. Albanesi (2002)
Inflation and InequalityCEPR Discussion Paper Series
N. Birdsall (1998)
Life Is Unfair: Inequality in the WorldForeign Policy
William Easterly, S. Fischer (1999)
Inflation and the PoorMacroeconomics eJournal
M. Szudejko (2012)
Measuring the Output Responses to Fiscal PolicyCfa Digest, 42
António Afonso (2006)
Expansionary Fiscal Consolidations in Europe – New Evidence2007 Fiscal Policy: Current Issues & Challenges Conference (Archive)
C. Rhee, J. Zhuang, R. Kanbur (2016)
Inequality in Asia and the Pacific : trends, drivers and policy implicationsJournal of Southeast Asian Economies, 33
Laurence Ball, D. Furceri, D. Leigh, Prakash Loungani (2013)
The Distributional Effects of Fiscal ConsolidationMacroeconomics: Monetary & Fiscal Policies eJournal
Karla Breceda, Jamele Rigolini, J. Saavedra (2008)
Latin America and the Social Contract: Patterns of Social Spending and TaxationPublic Economics: National Government Expenditures & Related Policies eJournal
Leonel Muinelo‐Gallo, Oriol Roca‐Sagalés (2013)
Joint determinants of fiscal policy, income inequality and economic growthEconomic Modelling, 30
Christina Romer, D. Romer (1989)
Does Monetary Policy Matter? A New Test in the Spirit of Friedman and SchwartzNBER Macroeconomics Annual, 4
E. Wolff, Ajit Zacharias (2007)
The Distributional Consequences of Government Spending and Taxation in the U.S., 1989 and 2000Public Economics: National Government Expenditures & Related Policies eJournal
I. Hollar, Rodrigo Cubero (2010)
Equity and Fiscal Policy: The Income Distribution Effects of Taxation and Social Spending in Central AmericaInstitutions & Transition Economics: Macroeconomic Issues eJournal
D. Coady, S. Gupta (2012)
Income Inequality and Fiscal Policy
PurposeThe purpose of this paper is to empirically examine the relationship between fiscal consolidations and changes in income distribution.Design/methodology/approachLooking at a sample of 27 emerging market economies between 1980 and 2014, the authors resort to both static panel techniques as well as dynamic impulse response function analysis using local projection methods to uncover the direct impact of adjustments on inequality.FindingsThe authors find that fiscal consolidations tend to lead to an increase in income inequality and reduce the redistributive role of fiscal policy. Spending-based consolidations are more detrimental to income distribution than tax based ones and fiscal retrenchment during bad times raises inequality. In times of fiscal expansion inequality seems to rise in the medium term and this effect is larger if the economy is booming.Research limitations/implicationsThe distributional effects of consolidation, i.e. whether consolidation can confer benefits, must be balanced against the potential longer term benefits. It should be recognized that there is scope for improving the targeting and efficiency of public programs and that fiscal adjustments would not unavoidably run into such an efficiency vs equity trade-off.Originality/valueThe paper, applying a consistent methodology, documents the set of fiscal episodes emerging market economies experienced over time. The authors empirically examine both the static and dynamic links between fiscal consolidation and inequality. Since composition matters, the authors explore how spending and tax-based fiscal consolidations affect income distribution. The authors conduct several robustness checks including the use of alternative income distribution proxies and state-contingent estimations on the phase of the business cycle.
International Journal of Emerging Markets – Emerald Publishing
Published: Apr 18, 2017
Read and print from thousands of top scholarly journals.
Already have an account? Log in
Bookmark this article. You can see your Bookmarks on your DeepDyve Library.
To save an article, log in first, or sign up for a DeepDyve account if you don’t already have one.
Copy and paste the desired citation format or use the link below to download a file formatted for EndNote
Access the full text.
Sign up today, get DeepDyve free for 14 days.
All DeepDyve websites use cookies to improve your online experience. They were placed on your computer when you launched this website. You can change your cookie settings through your browser.