First, the design of fiscal consolidation matters for labor market outcomes.
The debate on the growth and employment impact of spending-based versus revenue based
consolidations is not settled in the literature.
Some studies find that short-term spending multipliers are larger than revenue multipliers, while others have found the opposite.
Our analysis, which should be seen as suggestive rather than definitive, suggests
that in advanced economies, tax-based consolidations appear to be associated with a more adverse effect on jobs in normal times.
However the situation differs if the starting point of the adjustment is a protracted
recession, when expenditure adjustment is found to have a larger short-term adverse effect on employment.
In emerging and developing economies, expenditure based adjustments tend to have a more adverse effect on jobs, possibly due to cuts to already low levels of
public investment and public services.
Ultimately, what may matter most is the nature of the specific revenue
or expenditure measures implemented.
First, the design of fiscal consolidation matters for labor market outcomes.
The debate on the growth and employment impact of spending-based versus revenue based
consolidations is not settled in the literature.
Some studies find that short-term spending multipliers are larger than revenue multipliers, while others have found the opposite.
Our analysis, which should be seen as suggestive rather than definitive, suggests
that in advanced economies, tax-based consolidations appear to be associated with a more adverse effect on jobs in normal times.
However the situation differs if the starting point of the adjustment is a protracted
recession, when expenditure adjustment is found to have a larger short-term adverse effect on employment.
In emerging and developing economies, expenditure based adjustments tend to have a more adverse effect on jobs, possibly due to cuts to already low levels of
public investment and public services.
Ultimately, what may matter most is the nature of the specific revenue
or expenditure measures implemented.
การแปล กรุณารอสักครู่..