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Title: Is the Greek budget deficit sustainable after all? Empirical evidence accounting for regime shifts
Authors: Trachanas, Emmanouil
Katrakilidis, Constantinos
Type: Article
Subjects: FRASCATI::Social sciences::Economics and Business::Economics
Keywords: fiscal policy
budget deficit
structural breaks
Issue Date: 2014
Source: Applied Economics
Volume: 46
Issue: 20
First Page: 2387
Last Page: 2397
Abstract: his article re-examines the sustainability of the Greek budget deficit by using a formal framework based on the government’s intertemporal budget constraint. The empirical analysis uses annual data from 1960 to 2011 and employs traditional as well as more recent unit root and cointegration techniques that account for linear and nonlinear effects in fiscal policy actions. Unlike previous studies, the evidence suggests that, allowing for structural breaks, the Greek budget deficit is unsustainable. The parameter after the second detected break reflects the structural deficiencies of the Greek economy.
ISSN: 0003-6846
Other Identifiers: 10.1080/00036846.2014.902021
Appears in Collections:Department of Accounting & Finance

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