| Description |
1 online resource (49 pages) |
| Series |
IMF Working Paper ; WP/17/198 |
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IMF working paper ; WP/17/198.
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| Contents |
Cover; Contents; I. Introduction; II. Fiscal Stabilization and Growth: Channels; III. Data; A. Fiscal Stabilization; B. UNIDO data; C. Industry-level characteristics; IV. Methodology; V. Results; A. Baseline results; B. Robustness checks; C. Decomposition of industry growth; D. Recessions vs. expansions; E. Robust channels; VI. Conclusion; References; List of Figures; Figure 1: Fiscal stabilization over time, all countries, 1994-2016; Figure 2: Fiscal stabilization over time, within sample inter-quartile ranges; Figure 3: Fiscal stabilization and output volatility: Evidence across countries |
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Figure 4: Fiscal stabilization and output volatility: Evidence over timeList of Tables; Table 1: Industry-specific characteristics; Table 2: Correlation matrix of industry-specific characteristics; Table 3: Country coverage; Table 4: The effect of fiscal stabilization on industry growth: Value added; Table 5: The effect of fiscal stabilization on industry growth: Theories vs. findings; Table 6: The effect of fiscal stabilization on industry growth: Value added (lagged specification); Table 7: The effect of fiscal stabilization on industry growth: Gross output |
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Table 8: The effect of fiscal stabilization on industry growth: WLSTable 9: The effect of fiscal stabilization on industry growth: Alternative measures of fiscal stabilization; Table 10: The effect of fiscal stabilization on industry growth: Omitted variable bias; Table 11: The effect of fiscal stabilization on industry growth: Labor, capital. productivity; Table 12: The effect of fiscal stabilization on industry growth: Recession vs. expansions; Table 13: The effect of fiscal stabilization on industry growth: Horse race; Appendix |
| Summary |
Medium-term growth can be enhanced by fiscal stabilization. However, to date, no systematic effort has been made to study the specific channels through which fiscal stabilization affects growth. This paper examines the effect of fiscal stabilization on industrial growth and how this effect depends on different technological characteristics. It does so by applying a difference-in-difference approach to an unbalanced panel of 22 manufacturing industries for 55 advanced and developing economies over the period 1970-2014. The results suggest that fiscal stabilization fosters growth in industries with: i) higher external financial dependence and lower asset fixity; ii) higher degree of labor intensity; iii) higher investment lumpiness and relationship-specific input usage. These effects tend to be larger during economic recessions. The results are robust to different measures of fiscal stabilization and the inclusion of various interactions between a broad set of macroeconomic variables and production technologies |
| Notes |
Print version record |
| Subject |
General.
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Fiscal Policy.
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Financial Data.
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All Countries.
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| Form |
Electronic book
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| Author |
Furceri, Davide, author.
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Tovar Jalles, João, author.
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| ISBN |
9781484318560 |
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1484318560 |
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148431672X |
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9781484316726 |
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