Inflation Adjusted Government Budget Deficits and Their Impact on the Business Cycle: Empirical Evidence for Eight Industrial Countries

1989 ◽  
pp. 119 ◽  
Author(s):  
Tullio
Keyword(s):  
Business Cycle ◽  
Empirical Evidence ◽  
Budget Deficits ◽  
Government Budget ◽  
Industrial Countries ◽  
The Business Cycle

Business-cycle fluctuations in economic activity

2021 ◽  
pp. 105-125
Author(s):  
Jesper Rangvid
Keyword(s):  
Business Cycles ◽  
Business Cycle ◽  
Empirical Evidence ◽  
Economic Activity ◽  
Second Phase ◽  
Growth Trend ◽  
Business Cycle Fluctuations ◽  
The Business Cycle ◽  
Two Phases

This chapter explains what the business cycle is and what causes business-cycle fluctuations. We call fluctuations in economic activity around the long-term growth trend ‘the business cycle’. The business cycle consists of two phases. The first is a period of strong economic activity. The second, following the first, is a period of weak economic activity. We call the first phase of the business cycle an ‘expansion’ and the second phase a ‘contraction’ or ‘recession’. The chapter explains what causes business cycles, and examines the empirical evidence on the lengths and strengths of the typical business cycle. It finds that expansions typically last longer than recessions. The chapter also shows that the length of expansions has increased during recent decades.

How Is Tax Policy Conducted Over the Business Cycle?

2015 ◽  
Vol 7 (3) ◽  
pp. 327-370 ◽  
Author(s):  
Carlos A. Vegh ◽  
Guillermo Vuletin
Keyword(s):  
Business Cycle ◽  
Government Spending ◽  
Tax Policy ◽  
Developing Economies ◽  
Value Added ◽  
Tax Rates ◽  
Industrial Countries ◽  
Cyclical Behavior ◽  
The Business Cycle ◽  
Shed Light

It is well known by now that government spending has typically been procyclical in developing economies but acyclical or countercyclical in industrial countries. Little, if any, is known, however, about the cyclical behavior of tax rates (as opposed to tax revenues, which are endogenous to the business cycle and, hence, cannot shed light on the cyclicality of tax policy). We build a novel dataset on tax rates for 62 countries for the period 1960–2013 that comprises corporate income, personal income, and value-added tax rates. We find that tax policy is acyclical in industrial countries but mostly procyclical in developing countries. (JEL E32, E64, H24, H25, O11, O23)

Measuring the Sensitivity of Net Interest Paid to the Business Cycle and to Inflation

1987 ◽  
Vol 15 (3) ◽  
pp. 235-258 ◽  
Author(s):  
Thomas M. Holloway
Keyword(s):  
Business Cycle ◽  
Interest Rates ◽  
Analytical Framework ◽  
Budget Deficits ◽  
Factors Affecting ◽  
Short Run ◽  
Sample Application ◽  
Federal Debt ◽  
The Business Cycle

Net interest paid has been one of the most rapidly growing components of federal government expenditures since 1970. Unlike other components of the budget, public policy actions can have little effect on its rise—especially in the short run. For this reason, it is important to examine the forces “automatically” affecting net interest paid. This article examines the sources of change in net interest paid and provides an analytical framework to estimate the automatic effects of the business cycle and inflation. The framework incorporates the most important factors affecting net interest paid, including interest rates, budget deficits, and outstanding stocks (short-term and long-term debt and direct loans), and highlights the simultaneous relationship between net interest paid and changes in net debt (federal debt outstanding less direct loans outstanding). A sample application of the analytical framework is discussed.

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