The Determinants of the Volatility of Fiscal Policy Discretion

Luca Agnello, Ricardo M. Sousa, Luca Agnello

Risultato della ricerca: Article

10 Citazioni (Scopus)


This paper investigates the determinants of the volatility of fiscal policy discretion. Using a linear dynamic panel data model for 113 countries from 1980 to 2006 and a system-GMM estimator, we find that an increase in the number of episodes of government crisis, less democracy and presidentialist systems raise the volatility of the discretionary component of fiscal policy. Additionally, we show that countries with larger populations and less flexible exchange rate systems are more insured against uncertainty about the conduct of fiscal policy. Our results are robust to various regional dummy variables, different subsets of countries and the presence of high inflation and crisis episodes.
Lingua originaleEnglish
pagine (da-a)91-115
Numero di pagine25
RivistaFiscal Studies
Stato di pubblicazionePublished - 2014


All Science Journal Classification (ASJC) codes

  • Accounting
  • Finance
  • Economics and Econometrics

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