Series: IMF Working Papers
Author(s): Kevin Fletcher , and Damiano Sandri
Publisher: INTERNATIONAL MONETARY FUND
Publication Date: 05 March 2015
Keywords: hysteresis, fiscal multipliers, gdp, multipliers, debt, interest, interest rate,
We develop a simple model to examine the conditions under which delaying fiscal consolidation can affect the present value of GDP via the fiscal stance's effects on the output gap and hysteresis. We find that the a...