The Effectiveness of Fiscal Policy in Mexico
Empirical Economics Letters, Vol. 10, No. 6, p. 597, June 2011
6 Pages Posted: 20 Jan 2012
Date Written: June 1, 2011
Using a VAR model with quarterly information for the 1980 to 2008 period, this paper studies the dynamic effects of fiscal policy on Gross Domestic Product in the Mexican economy. We find evidence of non-Keynesian effects of government expenditure on GDP in the short run. Also, we find evidence that government revenue has a significant impact on GDP only in the fourth quarter.
Keywords: Non-Keynesian effects, fiscal policy, fiscal consolidations, Mexico
JEL Classification: E21, E62, E63, E65
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