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Analysis Of Automatic Stabilizers For The Criteria Of The General Government Deficit And Surplus As Percentage Of Gdp – Case Study For Romania

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  • AILINCA, Alina Georgeta

    (Centre for Financial and Monetary Research “Victor Slavescu”, N.I.E.R., Romanian Academy, Bucharest, Romania)

Abstract

The Maastricht Treaty but also the programmatic documents of the European Union require that an automatic stabilization mechanism has to be devised in order to meet the criteria of nominal economic convergence. For the analysis of the budget deficit expressed as a percentage of GDP, the literature does not yet draw up a curdled analysis, but only either an analysis in particular on the revenue side, emphasizing the qualities of the progressive fiscal regimes in the automatic stabilization, or an analysis on the side of the budgetary expenses, recognized in having the capacity of economic stabilization especially in Western economies. Thus, the article is designed to be a plea for designing a rather automatic mechanism for reaching the 3% of GDP threshold imposed by the Maastricht criterion regarding the budget deficit, carrying out an empirical, econometric analysis for Romania starting from the functioning mode of the instruments used by the Ministry of Finance.

Suggested Citation

  • AILINCA, Alina Georgeta, 2019. "Analysis Of Automatic Stabilizers For The Criteria Of The General Government Deficit And Surplus As Percentage Of Gdp – Case Study For Romania," Journal of Financial and Monetary Economics, Centre of Financial and Monetary Research "Victor Slavescu", vol. 7(1), pages 17-35, October.
    • Handle: RePEc:vls:rojfme:v:7:y:2019:i:1:p:17-35
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    References listed on IDEAS

    as
    1. Julia Darby & Jacques Melitz, 2008. "Social spending and automatic stabilizers in the OECD [‘Real-time output gaps in ex post policy analysis: A red herring?’]," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 23(56), pages 716-756.
    2. Dani Rodrik, 1998. "Why Do More Open Economies Have Bigger Governments?," Journal of Political Economy, University of Chicago Press, vol. 106(5), pages 997-1032, October.
    3. Alan J. Auerbach & Daniel R. Feenberg, 2000. "The Significance of Federal Taxes as Automatic Stabilizers," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 37-56, Summer.
    4. Young Lee & Taeyoon Sung, 2007. "Fiscal Policy, Business Cycles and Economic Stabilisation: Evidence from Industrialised and Developing Countries," Fiscal Studies, Institute for Fiscal Studies, vol. 28(4), pages 437-462, December.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    convergence; automatic stabilization; Romania;
    All these keywords.

    JEL classification:

    • E63 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus

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