Hysteresis and fiscal stimulus in a recession.
Ontology highlight
ABSTRACT:
SUBMITTER: Tervala J
PROVIDER: S-EPMC8855625 | biostudies-literature |
REPOSITORIES: biostudies-literature
Similar Datasets
Project description:The outbreak of the COVID-19 pandemic has brought the global economy to a crisis: how to choose the optimal policy tools to cope with the external impacts has attracted worldwide attention. The research evaluates the effects of China's fiscal and monetary policies in promoting economic recovery by establishing a CGE model. Five representative countermeasures such as exempting value-added tax (VAT) and cutting loan rates are studied. The results indicate that: from the aspect of fiscal policies, increasing investment shows a better effect in boosting economy compared with exempting VAT and increasing medical care expenditures; however, the policy also causes price inflation (+0.45%) and crowding-out of enterprise investment (-0.03%). From the aspect of monetary policies, providing targeted loans to enterprises has a better boosting effect on economy compared with cutting loan rates. In the choice between fiscal or monetary policies, fiscal policies exert better effects (household income, +0.95%) when taking the improvement of residents' welfare as the objective. If taking promoting recovery of enterprises and boosting the economy as objectives, monetary policies are found to be better (GDP, +1.99%). Therefore, fiscal and monetary policies should be guided by different objectives and allowed to work in a synergistic manner.
| S-EPMC9650139 | biostudies-literature
Project description:Using firm-level data from the Refinitiv Datastream Worldscope database for more than 17,253 non-financial firms in 45 advanced and emerging economies, this paper examines how fiscal stimulus interacted with sectoral business cycle sensitivity has affected firms' sales and capital expenditures during the global financial crisis. Cross-sectional analyses indicate that reductions in structural fiscal balances are associated with higher firms' sales and capital expenditures (as percentage of their total assets) in 2009. This result is obtained notably for the manufacturing and construction industries and for different regions depending on the firm performance variable. Our findings have key implications for the design of fiscal response to shocks at industry and firm levels, including during the current COVID-19 pandemic.Supplementary informationThe online version contains supplementary material available at 10.1057/s41294-021-00160-5.
| S-EPMC8335718 | biostudies-literature
Project description:In response to the 2008/2009 global financial crisis (GFC), many developing countries, including Indonesia, launched fiscal stimulus packages (FSP). These FSPs typically consist of several sophisticated fiscal policies that may not necessarily complement each other. While the impact of these policies at the aggregate country level in developed countries has been widely discussed, the spatial impact of these policies within developing countries is less understood. Utilizing an inter-regional computable general equilibrium (CGE) model, this paper aims to assess and understand the short- and long-term economic impacts of these stimulus policies using Indonesia as a case study. This paper, hence, provides a quantitative ex-post assessment of FSPs typically implemented during the 2009 GFC by developing economies. Overall, results, indicate that fiscal stimulus had a positive impact on aggregate demand and on poverty prevention, principally via stimulating private consumption. Corporate income tax cuts have the largest economic impact in the long-run, and cash transfers are the most useful policy tool for alleviating poverty. An FSP, however, could have an uneven spatial distributional effect on output across regions, particularly in the short-term.
| S-EPMC7558238 | biostudies-literature
Project description:How we perceptually organize a visual stimulus depends not only on the stimulus itself, but also on the temporal and spatial context in which the stimulus is presented and on the individual processing the stimulus and context. Earlier research found both attractive and repulsive context effects in perception: tendencies to organize visual input similarly to preceding context stimuli (i.e., hysteresis, attraction) co-exist with tendencies that repel the current percept from the organization that is most dominant in these contextual stimuli (i.e., adaptation, repulsion). These processes have been studied mostly on a group level (e.g., Schwiedrzik et al., 2014). Using a Bayesian hierarchical model comparison approach, the present study (N = 75) investigated whether consistent individual differences exist in these attractive and repulsive temporal context effects, with multistable dot lattices as stimuli. In addition, the temporal stability of these individual differences in context effects was investigated, and it was studied how the strength of these effects related to the strength of individual biases for absolute orientations. The results demonstrate that large individual differences in the size of attractive and repulsive context effects exist. Furthermore, these individual differences are highly consistent across timepoints (one to two weeks apart). Although almost everyone showed both effects in the expected direction, not every single individual did. In sum, the study reveals differences in how individuals combine previous input and experience with current input in their perception, and more generally, this teaches us that different individuals can perceive identical stimuli differently, even within a similar context.
| S-EPMC9274434 | biostudies-literature
Project description:The main goal of the paper is to analyse one-dimensional, isolated impact of particular variables which are used in the literature as explanatory variables for risk premium following fiscal tensions. Using Student's t-tests, supplemented with ANOVA analysis, we study about a hundred likely determinants of the risk premium in 22 OECD countries over 1978-2017. We find that for deeper falls in the risk premium following fiscal tensions, the size of fiscal adjustments matters more than their composition. That said, expenditure-based fiscal adjustments are more effective in lowering the risk premium than tax-based ones. Fiscal adjustments can outweigh the effects of global risk aversion. Otherwise its low level or decline is needed for deep falls in the risk premium, suggesting there are time-breaks in relations between the risk premium and other factors. Supply-side reforms, especially of the labour market, are of help. The risk premium often responds to their very announcements, indicating that fiscal tensions do not necessarily delay payoffs from reform efforts. That said, our results are only of qualitative nature and do not warrant any conclusions as to mechanisms or causality.Supplementary informationThe online version contains supplementary material available at 10.1007/s10663-022-09532-1.
| S-EPMC8918890 | biostudies-literature
Project description:Directed by a consolidated government budget constraint, we compare US monetary–fiscal responses to World Wars I and II and the War on COVID-19.
| S-EPMC9170155 | biostudies-literature
Project description:This paper proposes a new methodology based on textual analysis to forecast US recessions. Specifically, it presents an index in the spirit of Baker et al. (JAMA 131:1593–1636, 2016) and Caldara and Iacoviello (JAMA 1222, 2018) that tracks developments in US real activity. When used in a standard recession probability model, this index outperforms the yield curve-based forecast, a standard method to forecast recessions, at medium horizons, up to 8 months. Moreover, the index contains information not included in yield data, that are useful to understand recession episodes; when included as an additional control along with the slope of the yield curve, it improves forecasting accuracy by between 5% and 40%, depending on the horizon considered. These results are stable to a number of different robustness checks, including different estimation methods, different definitions of recession and controlling for asset purchases by major central banks. Our textual analysis data also improve the forecasting accuracy of several other popular leading indicators for the US business cycle. Supplementary Information The online version contains supplementary material available at 10.1057/s41308-022-00177-5.
| S-EPMC9305065 | biostudies-literature
Project description:Addressing vaccine compliance problems is of particular relevance and significance to public health. Despite resurgence of vaccine-preventable diseases and public awareness of vaccine importance, why is it so challenging to boost population vaccination coverage to desired levels especially in the wake of declining vaccine uptake? To understand this puzzling phenomenon, here we study how social imitation dynamics of vaccination can be impacted by the presence of imperfect vaccine, which only confers partial protection against the disease. Besides weighing the perceived cost of vaccination with the risk of infection, the effectiveness of vaccination is also an important factor driving vaccination decisions. We discover that there can exist multiple stable vaccination equilibria if vaccine efficacy is below a certain threshold. Furthermore, our bifurcation analysis reveals the occurrence of hysteresis loops of vaccination rate with respect to changes in the perceived vaccination cost as well as in the vaccination effectiveness. Moreover, we find that hysteresis is more likely to arise in spatial populations than in well-mixed populations, even for parameter choices that do not allow for bifurcation in the latter. Our work shows that hysteresis can appear as an unprecedented roadblock for the recovery of vaccination uptake, thereby helping explain the persistence of vaccine compliance problem.
| S-EPMC6367186 | biostudies-literature
Project description:Gastrocnemius aponeurotic recession is the surgical treatment for symptomatic gastrocnemius contracture. Endoscopic gastrocnemius recession procedures has been developed recently and reported to have fewer complications and better cosmetic outcomes. Classically, this is performed at the aponeurosis distal to the gastrocnemius muscle attachment. We describe an alternative endoscopic approach in which the intramuscular portion of the aponeurosis is released.
| S-EPMC4722783 | biostudies-literature
Project description:Many countries delegate a substantial part of social service decisions to local administrative levels, while federal laws provide the overall framework for service levels. Strict regulations to reduce budget overruns may however leave local governments with a potential trade-off between adhering to fiscal budgets and supplying critical welfare services as e.g. programs to protect vulnerable children. We investigate if budgetary constraints influence child protection decisions using high-quality register data. We show that the introduction of fiscal sanctions to improve budget adherence contributed to a sharp decline in budget overruns on child protective services by reducing the number of children in out-of-home care. Our results further show that monthly variation in budget adherence within a fiscal year affects the probability of a placement in out-of-home care for children in need of help towards the end of a fiscal year. We estimate that a budget overrun of 10 percentage points by mid-year leads to a 1.2 percent reduction in the number of children in care over the remaining part of the fiscal year. Municipalities reduced child protection expenditure by choosing cheaper types of care and ending placement for children in out-of-home care, particularly for children turning 18. Our paper contributes to the literature on fiscal federalism by documenting the trade-off between managing public expenditure and providing safety and equal opportunity for vulnerable children. We thus highlight that enforcing strict budget adherence may be in conflict with social policy goals. Our results raise an important discussion about centralization versus delegation of critical public services.
| S-EPMC8947134 | biostudies-literature