Expansionary Austerity : Reallocating Credit Amid Fiscal Consolidation (English)

This paper shows expansionary fiscal austerity via reallocation of credit supply, but with a raise in poverty. For identification, the paper exploits the introduction of a Mexican law limiting the debt of subnational governments along with matched credit register, firm, bank, and state datasets. After the law, states with higher ex ante public debt grow substantially faster, despite larger fiscal consolidation (higher taxes and lower public expenditure)...

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Author

Morais, Bernardo;

Perez-Estrada, Javier;

Peydró, José-Luis;

Ruiz Ortega, Claudia;
Document Date
2021/05/10
Document Type
Policy Research Working Paper
Report Number
WPS9655
Volume No
1
Total Volume(s)
1
Country
Mexico,
Region
Latin America and Caribbean,
Disclosure Date
2021/05/10
Disclosure Status
Disclosed
Doc Name
Expansionary Austerity : Reallocating Credit Amid Fiscal Consolidation
Keywords
development research group

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Citation

Morais, Bernardo; Perez-Estrada, Javier; Peydró, José-Luis; Ruiz Ortega, Claudia.

Expansionary Austerity : Reallocating Credit Amid Fiscal Consolidation (English). Policy Research working paper|no. WPS 9655 Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/147941620675969963

Expansionary Austerity : Reallocating Credit Amid Fiscal Consolidation (English)

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