An Exploration of the Private Sector Response to Changes in Government Saving Across OECD Countries

May 1, 2001

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Format: Chicago

Alun H. Thomas An Exploration of the Private Sector Response to Changes in Government Saving Across OECD Countries, (USA: International Monetary Fund, 2001) accessed September 19, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

Several recent papers have examined the response of national saving to changes in fiscal policy. This paper uses knowledge about the intergenerational fiscal position of a country to determine whether this information helps to explain cross country differences in the nature of the response. Using OECD data the paper finds that in countries in intergenerational fiscal balance, the private sector completely offsets fiscal policy changes whereas in other countries the private sector offset is only partial. Moreover, in countries with large intergenerational fiscal imbalances, strong fiscal consolidation packages reduce the impact of changes in fiscal policy on national saving.

Subject: Expenditure, Fiscal consolidation, Fiscal policy, Fiscal stance, National accounts, Private savings

Keywords: Europe, Expenditure coefficient, Fiscal consolidation, Fiscal policy, Fiscal stance, Government saving, Intergenerational fiscal balance, National saving, Private savings, Ricardian effects, Saving position, Saving rate, WP

Publication Details

Pages:

26
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2001/069
Stock No:

WPIEA0692001
ISBN:

9781451849066
ISSN:

1018-5941

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