Spanish Public Finances Through the Financial Crisis
35 Pages Posted: 6 Oct 2016
Date Written: October 5, 2016
Spain’s public finances have been under significant stress during the crisis, despite pre-crisis fiscal surpluses and low levels of public debt. The impact of the crisis and an initial phase of counter-cyclical activism exacerbated the existing (structural) fiscal vulnerabilities. To correct the fiscal imbalances, a significant number of bold policy actions were taken, affecting taxation, public spending, national fiscal rules and the structure of the public sector. In this paper we discuss the evolution of public finances in Spain during the financial crisis, framing crisis-related fiscal policy measures within medium-term economic trends and focusing on policy responses to the financial crisis. We also touch upon the main policy challenges ahead.
Keywords: fiscal policy, Great Recession, public deficit, public debt, Spanish economy
JEL Classification: E60, H12, H50, H60
Suggested Citation: Suggested Citation