Sustainable fiscal strategies under changing demographics

Hallett, Andrew Hughes; Jensen, Svend E. Hougaard; Sveinsson, Thorsteinn Sigurdur; Vieira, Filipe

doi:10.1016/j.ejpoleco.2018.07.003

Cited by 7 publications

(13 citation statements)

References 21 publications

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“…In contrast, Hughes Hallett et al [98] contend that fiscal sustainability is not a matter of long-term debt but is an issue of changes in taxes and spending in transition. In a more recent study, Hughes Hallett et al [99] contend that even deteriorating population parameters, a relatively benign steady state is possible. Nevertheless, they emphasize that probably it will achieve with some fiscal and financial breakdowns along the way.…”

Section: Literature Reviewmentioning

confidence: 99%

Fiscal Sustainability in Aging Societies: Evidence from Euro Area Countries

Ramos-Herrera

Sosvilla‐Rivero

2020

Sustainability

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Fiscal sustainability remains a paramount challenge in the Euro Area (EA) countries after the sharp rise in public debt-to-GDP ratios in the aftermath of the financial crisis of 2008. Using data from 11 EA countries over the period 1980–2019, we apply panel data techniques to examine the effects of population aging on fiscal sustainability, controlling for key macroeconomic variables. Our results suggest that the discretionary fiscal policy is strongly persistent, not being consistent with long-term fiscal solvency. Moreover, our results indicate that the fiscal stance is countercyclical for the countries under study and that population aging poses a major challenge for fiscal sustainability. The findings are robust to a different grouping of countries within the sample (core and peripheral countries, relatively old and young countries, and relatively more and less indebted countries). We consider that our results may have some practical meaning for national policymakers and international organizations responsible for regional and global fiscal surveillance and might shed some light on the possible effects that population aging could have on the effort of EA countries to restore public finances on a sustainable basis.

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Section: Literature Reviewmentioning

confidence: 99%

Fiscal Sustainability in Aging Societies: Evidence from Euro Area Countries

Ramos-Herrera

Sosvilla‐Rivero

2020

Sustainability

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“…A key question is what a standard macroeconomic model would say about the behavior of an economy following demographic shocks, such as lower fertility rates and increases in longevity. Recent work of ours- Bokan et al (2016) and Hughes Hallett et al (2019)-has established that a new steady state exists despite deteriorating demographics. Also, our research has shown that it is a benign steady state in terms of economic growth and the optimal level of public debt.…”

Section: Introductionmentioning

confidence: 98%

“…In this section we outline the building blocks of the model while referring to Bokan et al (2016) andHughes Hallett et al (2019) for further detail.…”

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confidence: 99%

From Here to There: Achieving Fiscal Sustainability Under Alternative Demographic Contingencies

2021

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This paper develops a model with overlapping generations of households, productive public and private capital, and a golden rule of fiscal policy aimed at maximizing economic growth. Studying the transitional dynamics between steady states triggered by different exogenous shocks, we find that a waning fertility rate, coming through a weaker preference for having children, increased longevity, a decrease in subjective discounting or lower financial support for child rearing, will require a policy intervention to ensure convergence to the growth maximizing debt level. A simple calibration exercise shows that when faced with projected demographic aging the adjustments in public debt and public investment required for keeping the economy at its maximum steady state growth rate may be small.

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“…The works of many scientists are devoted to the study of the impact of demographic trends on economic development (Gasparenienea and Remeikienea, 2016). Docquier et al (2019) explore demographic trends and human development; Strulik (1999) studies the development of demography and economic cycles; Hallett et al (2019) research sustainable fiscal strategies under changing demographics; and Volodymyr Gumeniuk explores the impact of demographic factors on the financial stability of tourism enterprises (Gumeniuk, 2015). O'Sullivan (2020) argues that stabilization of the population is needed to ensure stable economic development of the state.…”

Section: Introductionmentioning

confidence: 99%

History of Agriculture of Galicia from the Second Half of 19th to First Third of 20th Centuries

Makaruk

Tokar

Filoretova

et al. 2021

GJNR

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From the second half of the 19th century until the beginning of the World War I, there was significant economic advancement in all sectors of farm management in the territory of Galicia (Halychyna), which was under the control of the Austro-Hungarian Empire during that period of history. This paper focuses on the impact of popular scientific extension, one of the key criteria for communicating the latest economic management techniques at that time. This allowed the region, which was significantly behind the other regions within the Austro-Hungarian Empire during that period, to progress economically. There was a breakthrough in methods and approaches to farm management during the studied period. The processes of mechanization, novel tillage techniques and land reclamation were introduced. Agricultural processing industry started to develop intensively. A serious consideration has been given to selective breeding of animals, which had a positive impact on the livestock rearing development. All these aspects have led to a significant improvement in the industry’s performance.

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Sustainable fiscal strategies under changing demographics

Cited by 7 publications

References 21 publications

Fiscal Sustainability in Aging Societies: Evidence from Euro Area Countries

Fiscal Sustainability in Aging Societies: Evidence from Euro Area Countries

From Here to There: Achieving Fiscal Sustainability Under Alternative Demographic Contingencies

History of Agriculture of Galicia from the Second Half of 19th to First Third of 20th Centuries

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