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Fiscal Multipliers for Brazil
Author:
Mr. Troy D Matheson
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and
Ms. Joana Pereira
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Series:
IMF Working Papers
Volume/Issue:
Volume 2016: Issue 079
Language:
English
Publication Date:
25 Mar 2016
DOI:
https://doi.org/10.5089/9781484307892.001
ISBN:
9781484307892
ISSN:
1018-5941
Pages:
16
Keywords:
WP; revenue; Fiscal policy; fiscal multipliers; public credit; credit multiplier; credit shock; spending increase; expenditure series; revenue multiplier; Policy lending; credit supply; discretionary spending; credit increase; Credit; State-owned banks; Global
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IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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We find historical fiscal multipliers for Brazil around 0.5, larger than what existing literature typically identifies for the average emerging market. However, spending and public credit multipliers seem to have dropped to near zero since the global financial crisis, as the estimate for the whole sample period (1999-2014) is about ½ of that for precrisis years. By contrast, revenue multipliers have remained broadly stable. We conclude that fiscal consolidations based on expenditure and public credit retrenchment are likely to entail a modest drag on growth in the near term.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund