Rasmus Wiese, Richard Jong-A-Pin, Jakob de Haan, 26 March 2018

Empirical research concludes that austerity measures that target spending are more likely to succeed than those that target taxation. This column argues that this result arises from a methodological flaw that assumes all countries have equal variability in their budget balance. Correcting for this in data from 20 OECD countries suggests that spending-based and revenue-based adjustments have been equally successful.

Events

CEPR Policy Research