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Athanasios O. Tagkalakis
''The output effects of systematic and non-systematic fiscal policy changes in Greece''
( 2013, Vol. 33 No.3 )
This paper investigates the effects of systematic (or rules-based) and non-systematic (exogenous) fiscal policy changes on output growth in Greece, focusing also on the composition of fiscal policy. Exogenous fiscal policy changes are associated with Keynesian responses (with the exception of net transfers and VAT). Systematic government spending cuts aiming at improving fiscal performance although they tend to have a Keynesian effect on output growth in the short term, they ultimately result in a non-Keynesian response, raising output growth. Systematic direct tax hikes, aiming at correcting fiscal imbalances, can have positive medium to long term growth effects.
Keywords: Fiscal rules, output growth, exogenous, systematic
JEL: E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General
H6 - National Budget, Deficit, and Debt: General
Manuscript Received : Apr 29 2013 Manuscript Accepted : Jul 13 2013

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