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Fiscal Policy Effectiveness in the Tunisian Economy

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  • Slah Slimani

    (University of Tunis El Manar, Tunisia)

Abstract

Based on Blanchard and Perotti, Perotti, and Biau and Girard approaches, this paper evaluates the fiscal policy's effectiveness in Tunisia using Structural VAR model. The results show the short-run macroeconomic efficiency of a structural increase in public spending in Tunisia with a fiscal multiplier close to 1,806, in line with Keynesian's models. However, the estimated effect of a structural increase in tax revenues on activity is non-Keynesian. This is explained by the presence of a voracity effect in the case of the Tunisian economy.

Suggested Citation

  • Slah Slimani, 2021. "Fiscal Policy Effectiveness in the Tunisian Economy," International Journal of Sustainable Economies Management (IJSEM), IGI Global, vol. 10(4), pages 21-38, October.
  • Handle: RePEc:igg:jsem00:v:10:y:2021:i:4:p:21-38
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