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Non-Keynesian Effects of Fiscal Expansions in Israel

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  • Yaron Zelekha

Abstract

The unique characteristics of the fiscal policy in Israel that created one of the largest public sectors assumed many similarities to the characteristics described in the economic literature as related to non-Keynesian effects. The results point indeed to significant asymmetrical negative effect of public consumption on product in Israel that exists even in minor fiscal changes and has long-term effects. Against this background emerges the possibility of considerable unutilized potential growth in Israel, which can be realized by means of drastic contraction of public spending and of tax burden to proportions acceptable in the West.

Suggested Citation

  • Yaron Zelekha, 2010. "Non-Keynesian Effects of Fiscal Expansions in Israel," The IUP Journal of Public Finance, IUP Publications, vol. 0(4), pages 31-38, November.
    • Handle: RePEc:icf:icfjpf:v:08:y:2010:i:3:p:31-38
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