Italy: Fiscal Consolidation and its Legacy

Balassone, Fabrizio; Franco, Daniele; Momigliano, Sandro; Monacelli, Daniela

doi:10.2139/ssrn.2094455

Cited by 42 publications

(10 citation statements)

References 25 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…There is consensus that changes to the pension rules 9 were the main structural reforms implemented during the period under consideration. Whether this was sufficient to restore equilibrium to the pension system or not is under discussion, but that the reforms aided the sustainability of the system is beyond question (Sartor, 2001;Balassone et al, 2003). In general, Figure 2 shows that, in both comparisons (G 52 vs G 70 and G 70 vs G 88 ), the differences between taxes paid and benefits received by the older generation with respect to the younger are very similar, with the latter paying more taxes and receiving more benefits: a result of the productivity growth occurring between the two base years.…”

Section: Background and Methodsmentioning

confidence: 99%

“…The impact of the consolidation process on fiscal sustainability and the burden left to future generations have been analysed in a number of papers (see Cardarelli and Sartor (2000), and Rizza and Tommasino (forthcoming)). However, the allocative and redistributive implications of the consolidation policies introduced in the '90s are less clear and have received less attention in the literature (Balassone et al, 2003). In particular, in our view, the distribution of the burden across living generations has not been sufficiently investigated.…”

Section: Introductionmentioning

confidence: 94%

See 1 more Smart Citation

Public Finance Consolidation and Fairness Across Living Generations: The Case of Italy

et al. 2012

View full text Add to dashboard Cite

The paper is a contribution to the study of the redistributive impact of public sector intervention across living generations. We aim to work on a comprehensive approach, so that reforms involving several taxation and spending programmes, possibly implemented over several years, may be assessed. By adapting methods from the generational accounting literature, we investigate the impact on fairness between living generations of fiscal policies undertaken in Italy between 1990 and 2008. Large intergenerational differences exist in net tax rates calculated over the residual lifetime horizon, which tend to be substantially higher for young generations. Pension reforms introduced in the '90s play a major role in explaining these differences. We conclude that a significant contribution to the sustainability of these reforms might have come at the price of an unequal distribution of sacrifices across living generations. Awareness of these differences could help in designing additional consolidation efforts in the perspective of achieving intergenerational fairness in Italy. * The present work is a development of some ideas previously included in a contribution by the same authors to Schizzerotto A., Trivellato U., Sartor N. 2011 (eds.) "Generazioni Diseguali"; Collana della Fondazione Ermanno Gorrieri per gli studi sociali. Il Mulino, Bologna.

show abstract

Section: Background and Methodsmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 94%

Public Finance Consolidation and Fairness Across Living Generations: The Case of Italy

et al. 2012

View full text Add to dashboard Cite

show abstract

“…In a study with a descriptive nature, Balassone et al (2002) concluded that the consolidation of Italian public finances in the 1990s has been highly successful in putting an end to endemic high deficits and preventing the country from sliding into debt default. However, while fiscal consolidation has avoided major economic and social shocks, it has not been a panacea for Italian fiscal problems.…”

Section: Theoretical Framework and Empirical Literature Reviewmentioning

confidence: 99%

Sustainability of Italian budgetary policies: a time series analysis (1862-2013)

Brady

Magazzino

2017

Eur J Gov Econ

View full text Add to dashboard Cite

In this paper, we analyze the sustainability of Italian public finances using a unique database covering the period 1862-2013. This paper focuses on empirical tests for the sustainability and solvency of fiscal policies. A necessary but not sufficient condition implies that the growth rate of public debt should in the limit be smaller than the asymptotic rate of interest. In addition, the debt-to-GDP ratio must eventually stabilize at a steady-state level. The results of unit root and stationarity tests show that the variables are non-stationary at levels, but stationary in first-differences form, or I(1). However, some breaks in the series emerge, given internal and external crises (wars, oil shocks, regime changes, institutional reforms). Therefore, the empirical analysis is conducted for the entire period, as well as two sub‐periods (1862‐1913 and 1947‐2013). Moreover, anecdotal evidence and visual inspection of the series confirm our results. Furthermore, we conduct tests on cointegration, which evidence that a long-run relationship between public expenditure and revenues is found only for the first sub-period (1862-1913). In essence, the paper’s results reveal that Italy have sustainability problems in the Republican age.

show abstract

“…Regarding public finances, Balassone et al (2002) pointed out the need to make close-to-balance budgets a permanent feature of Italian fiscal policy, while shifting the focus of budgetary policy from short-term deficit control to the traditional functions of stabilisation, allocation and distribution. In light of this, the importance of i) designing a set of fiscal rules for local governments consistent with increasingly decentralised public activities; ii) improving the quality of public services while maintaining tight expenditure control; and iii) reducing the high tax burden, was recognised.…”

mentioning

confidence: 99%

The Policy Response to Macroeconomic and Fiscal Imbalances in Italy in the Last Fifteen Years

et al. 2013

Self Cite

View full text Add to dashboard Cite

Italy: Fiscal Consolidation and its Legacy

Cited by 42 publications

References 25 publications

Public Finance Consolidation and Fairness Across Living Generations: The Case of Italy

Public Finance Consolidation and Fairness Across Living Generations: The Case of Italy

Sustainability of Italian budgetary policies: a time series analysis (1862-2013)

The Policy Response to Macroeconomic and Fiscal Imbalances in Italy in the Last Fifteen Years

Contact Info

Product

Resources

About