The Role of Institutional Quality on the Effects of Fiscal Stimulus
This paper provides evidence on the effect of fiscal stimulus on economic activity for countries with different degrees of institutional quality. For a panel of 113 countries during the period 1988-2017, we find evidence that an increment of 1% in government consumption yields a sizable, persistent and stable increase in economic activity of 0.9% in countries with higher institutional quality.
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| Language: | English |
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Inter-American Development Bank
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| Subjects: | Fiscal Policy, Public Investment, Economic Development, Political Institution, E62 - Fiscal Policy, E32 - Business Fluctuations • Cycles, E02 - Institutions and the Macroeconomy, Fiscal policy;Economic activity;Institutional quality, |
| Online Access: | http://dx.doi.org/10.18235/0002316 https://publications.iadb.org/en/the-role-of-institutional-quality-on-the-effects-of-fiscal-stimulus |
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