The global financial crisis of 2008–09 has sent public debt on sharply higher trajectories, as governments have provided large-scale support to the financial system, implemented discretionary fiscal stimulus, and accommodated steep drops in tax revenue. With the economic recovery gradually taking hold, the focus is now shifting to fiscal “exit strategies.” Indeed, many countries are set to face...

this paper investigates the impacts of economic and financial developments on environmental pollution for 6 opec countries using panel cointegration and panel long-run estimator (dols) over the period 1980–2008.  the results shows that both economic and financial development have significant effect on the environmental quality in selected opec economies. the findings not support the existence o...

D iscussions of rules vs. discretion have occupied a central place in the analysis of macroeconomic policies in dynamic models. Costas Azariadis and Vincenzo Galasso have presented a new model that shows how a discretionary policy regime can lead to a more volatile fiscal policy than one pursued under a constitutional rule. They set up a simple fiscal policy story and examine the potential for ...

This paper is an attempt to investigate the effect of fiscal policy on output in Indonesia using Structural Vector Autoregression (SVAR) methodology for the period 1983:1 – 2010:1. We use contemporaneous restriction and follow Blanchard and Perotti (1999) technique to identify structural fiscal policy shocks in Indonesia. The estimation results show that the government spending shocks are found...

This study incorporates Zakat into a simple macroeconomic model of an Islamic economy and analyzes the role of Zakat in the national income determination. The reduced form aggregate consumption function suggests that the determinants of consumption are: Zakat expenditure, taxes, income, and asset holdings of individuals. Zakat could be used as a counter-cyclical policy through the discretionary...

BACKGROUND There is a large body of literature examining income in relation to health expenditures. The share of expenditures in health sector from GDP in developed countries is often larger than in non-developed countries, suggesting that as the level of economic growth increases, health spending increase, too. OBJECTIVES This paper estimates long-run relationships between health expenditure...

E agree about the goals of price stability, low unemployment and stable economic growth, but they disagree about the policies to achieve these goals. The disagreement is particularly heated over discretionary countercyclical Keynesian fiscal policy. After the poor macroeconomic performance of the 1970s and critical policy evaluations of the Keynesian approach— ranging from Robert E. Lucas and T...