The Costs of Greece"s Fiscal Consolidation
JOURNAL ARTICLE
Cite JOURNAL ARTICLE
Style
Format
The Costs of Greece"s Fiscal Consolidation
Gechert, Sebastian | Rannenberg, Ansgar
Vierteljahrshefte zur Wirtschaftsforschung, Vol. 84 (2015), Iss. 3 : pp. 47–59
13 Citations (CrossRef)
Additional Information
Article Details
Author Details
Sebastian Gechert, (corresponding author), Macroeconomic Policy Institute (IMK)
Ansgar Rannenberg, Macroeconomic Policy Institute (IMK) and Central Bank of Ireland
Cited By
-
Impact of fiscal consolidation in different states of domestic government debt in South Africa 1979 to 2022
Buthelezi, Eugene Msizi | Nyatanga, PhocenahCogent Economics & Finance, Vol. 11 (2023), Iss. 2
https://doi.org/10.1080/23322039.2023.2280326 [Citations: 2] -
Reconsidering macroeconomic policy prescriptions with meta-analysis
Gechert, Sebastian
Industrial and Corporate Change, Vol. 31 (2022), Iss. 2 P.576
https://doi.org/10.1093/icc/dtac005 [Citations: 8] -
A contribuição da política fiscal para a crise brasileira de 2015-2016: uma análise baseada em multiplicadores de despesas e receitas primárias do governo central no período 1997-2018
Sanches, Marina da Silva | Carvalho, Laura Barbosa deNova Economia, Vol. 32 (2022), Iss. 1 P.7
https://doi.org/10.1590/0103-6351/6964 [Citations: 2] -
Do Economic Adjustment Programmes Set Conflicting Objectives? The Case of Greece
Liargovas, Panagiotis | Psychalis, MariosTheoretical Economics Letters, Vol. 09 (2019), Iss. 08 P.3065
https://doi.org/10.4236/tel.2019.98188 [Citations: 10] -
Spectral Theory of Value and Actual Economies
Effective Demand and Devaluation Policies: Evidence from Input–Output Tables for Eurozone Economies
Mariolis, Theodore | Rodousakis, Nikolaos | Soklis, George2021
https://doi.org/10.1007/978-981-33-6260-4_9 [Citations: 1] -
Tax Elasticities and the Macroeconomic Effects of Fiscal Policy in Greece
Zervas, Andreas
Applied Economics Quarterly, Vol. 64 (2018), Iss. 1 P.59
https://doi.org/10.3790/aeq.64.1.59 [Citations: 1] -
Fiscal Adjustment and Debt Sustainability: Greece 2010-2016 and Beyond
Karavitis, Panagiotis
SSRN Electronic Journal , Vol. (2018), Iss.
https://doi.org/10.2139/ssrn.4196629 [Citations: 1] -
The dynamic relationship between government debt, fiscal consolidation, and economic growth in South Africa: A threshold analysis
Buthelezi, Eugene M. | Nyatanga, PhocenahCogent Economics & Finance, Vol. 11 (2023), Iss. 2
https://doi.org/10.1080/23322039.2023.2261329 [Citations: 4] -
Phillips Curve: The Greek Case
Liargovas, Panagiotis | Psychalis, MariosEuropean Review, Vol. 30 (2022), Iss. 2 P.244
https://doi.org/10.1017/S1062798720001301 [Citations: 5] -
Global Crisis and Reproduction of Capital
Economic Policies and Economic Perspectives
Tombazos, Stavros
2019
https://doi.org/10.1007/978-3-030-05725-1_5 [Citations: 0] -
Fiscal reforms in the EMU: the Greek response
Liargovas, Panagiotis | Psychalis, MariosEuropean Politics and Society, Vol. 22 (2021), Iss. 5 P.757
https://doi.org/10.1080/23745118.2020.1827776 [Citations: 2] -
ACUMULACIÓN DE DEUDA PÚBLICA Y POLÍTICA FISCAL EN AMÉRICA LATINA
Zavaleta González, Josué
Investigación Económica, Vol. 79 (2020), Iss. 314 P.3
https://doi.org/10.22201/fe.01851667p.2020.314.76704 [Citations: 3] -
WHICH FISCAL MULTIPLIERS ARE REGIME‐DEPENDENT? A META‐REGRESSION ANALYSIS
Gechert, Sebastian | Rannenberg, AnsgarJournal of Economic Surveys, Vol. 32 (2018), Iss. 4 P.1160
https://doi.org/10.1111/joes.12241 [Citations: 68]
Abstract
This policy brief reexamines the effects of the Greek austerity experiment on its economy via a counterfactual analysis. We combine the fiscal multipliers from the meta regression analysis in Gechert and Rannenberg (2014) to the fiscal consolidation measures that have been implemented in Greece between 2010 and 2014. We estimate that austerity explains almost the entire collapse of Greek GDP after 2009. This result suggests that–ceteris paribus–, in the absence of austerity, the Greek economy would have entered a prolonged period of stagnation, rather than a depression. At the same time the path of the government debt-to-GDP ratio would have been only somewhat higher. Furthermore, we estimate that if the consolidation would have been postponed until after the recovery of the Greek economy and implemented gradually, almost 80 percent of the cost in terms of lost output could have been avoided. Our results suggest that the period 2010–2014 was the wrong time to implement frontloaded spending cuts due to their strong multipliers in downturns. Implementing only the revenue components of the Greek fiscal consolidation would have strongly reduced the output contraction as compared to the actual path of GDP, but would have been much more effective at lowering the debt-to-GDP ratio than the actual fiscal consolidation. A more cautious consolidation would thus have been in the interest of international creditors as well.