Politická ekonomie 2014, 62(2):174-193 | DOI: 10.18267/j.polek.945

Odhad vplyvu fiąkálnej konsolidácie na rast HDP v SR

Monika Pécsyová
Inątitút finančnej politiky, Ministerstvo financií SR.

Estimated Impact of Fiscal Consolidation on GDP Growth in the Slovak Republic

The Slovak economy is experiencing another significant phase of fiscal consolidation in its history. Unlike previous episodes of major consolidation in our history, our economy cannot "rely" on a soft cushion in the form of favourable global economic situation, integration and launch of new capacities in the automotive industry, as it was in 2003-2005 and 2011. The main objective of this paper is to estimate the size of fiscal multipliers in Slovakia in order to quantify the impact of fiscal packages in 2011 and 2013. The results show that the expenditure oriented consolidation has higher costs in form of lost growth. However, in the medium to long term it is less painful. Effect of consolidation package on GDP growth in 2011 is estimated at -0.99 percentage points. In 2013, we estimate that the fiscal consolidation cuts the growth of 0.68 percentage points.

Keywords: fiscal multiplier, fiscal consolidation, structural autoregression model, impulse response function
JEL classification: E62, H30, H50, H60

Published: April 1, 2014  Show citation

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Pécsyová, M. (2014). Estimated Impact of Fiscal Consolidation on GDP Growth in the Slovak Republic. Politická ekonomie, 62(2), 174-193. doi: 10.18267/j.polek.945
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