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Effectiveness of Fiscal Policy in Different Economic Conditions
[Эффективность Фискальной Политики В Разных Условиях Функционирования Экономики]

Author

Listed:
  • Olesya V. Polyakova

    (Financial University under the Government of the Russian Federation)

Abstract

The article describes the international research experience of recent years in terms of assessing the impact of fiscal policy on the economy through the use of fiscal multipliers. It is shown how the effectiveness of fiscal measures differs depending on the phase of the economic cycle, the causes of economic fluctuations, the characteristics of households (preference for risk-free assets), the labor market (aging of the population, downward rigidity of wages), the monetary policy regime, the level of creditworthiness of the economy and a number of other parameters. Regarding the application of research results for the development of fiscal policy in modern Russia, the following recommendations can be given (to achieve maximum effect for the economy): stimulate supply, support the labor market. In addition, when conducting policy, it is necessary to take into account the degree of household debt. The article is based on the findings of research conducted with financial support from the budget funds under the state assignment of the Financial University under the Government of the Russian Federation.

Suggested Citation

  • Olesya V. Polyakova, 2023. "Effectiveness of Fiscal Policy in Different Economic Conditions [Эффективность Фискальной Политики В Разных Условиях Функционирования Экономики]," Russian Economic Development, Gaidar Institute for Economic Policy, issue 10, pages 45-52, October.
    • Handle: RePEc:gai:recdev:r2383
    as

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    References listed on IDEAS

    as
    1. Marco Bernardini & Gert Peersman, 2018. "Private debt overhang and the government spending multiplier: Evidence for the United States," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 33(4), pages 485-508, June.
    2. Yoon J. Jo & Sarah Zubairy, 2021. "State dependent government spending multipliers: Downward nominal wage rigidity and sources of business cycle fluctuations," Working Papers 20210127-001, Texas A&M University, Department of Economics.
    3. Mathias Klein, 2017. "Austerity and Private Debt," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 49(7), pages 1555-1585, October.
    4. Ghassibe, Mishel & Zanetti, Francesco, 2022. "State dependence of fiscal multipliers: the source of fluctuations matters," Journal of Monetary Economics, Elsevier, vol. 132(C), pages 1-23.
    5. Klein, Mathias & Winkler, Roland, 2019. "Austerity, inequality, and private debt overhang," European Journal of Political Economy, Elsevier, vol. 57(C), pages 89-106.
    6. Matthew Canzoneri & Fabrice Collard & Harris Dellas & Behzad Diba, 2016. "Fiscal Multipliers in Recessions," Economic Journal, Royal Economic Society, vol. 126(590), pages 75-108, February.
    7. A. Kudrin & A. Knobel, 2017. "Fiscal policy as a source of economic growth," Voprosy Ekonomiki, NP Voprosy Ekonomiki, issue 10.
    8. A. Kudrin & A. Knobel., 2017. "Fiscal policy as a source of economic growth," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 10.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    fiscal policy; fiscal multiplier; DSGE models; economic cycle;
    All these keywords.

    JEL classification:

    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General
    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
    • H60 - Public Economics - - National Budget, Deficit, and Debt - - - General

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