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An International Comparison of Success Factors for Budget Consolidation Strategies

Author

Listed:
  • Hans Pitlik
  • Norbert Gruber

    (WIFO)

  • Ewald Walterskirchen

    (WIFO)

Abstract

In numerous countries the global financial and economic crisis has entailed a surge of government debt, which will call for enhanced consolidation efforts in the future. In the past consolidation strategies focusing primarily on spending cuts proved sustainable, whereas mostly revenue-based strategies were less successful. A suitable institutional framework, e.g., budgetary expenditure ceilings, also contributes to a lasting fiscal consolidation. The short-term growth effects of budget balancing efforts are more disputed. Besides contractionary ("Keynesian") effects empirical studies also find expanisionary ("non-Keynesian") effects of ambitious consolidation programmes under certain conditions.

Suggested Citation

  • Hans Pitlik & Norbert Gruber & Ewald Walterskirchen, 2010. "An International Comparison of Success Factors for Budget Consolidation Strategies," Austrian Economic Quarterly, WIFO, vol. 15(2), pages 198-210, July.
    • Handle: RePEc:wfo:wquart:y:2010:i:2:p:198-210
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    References listed on IDEAS

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