Fiscal consolidation during a depression: the current economic pain could not have been avoided but could have been substantially reduced
Van Reenen, J.
& Bagaria, N.
(2012).
Fiscal consolidation during a depression: the current economic pain could not have been avoided but could have been substantially reduced.
& Bagaria, N.
(2012).
Fiscal consolidation during a depression: the current economic pain could not have been avoided but could have been substantially reduced.
John Van Reenen and Nitika Bagaria respond to the recent bad news on government borrowing by modelling three different fiscal consolidation scenarios. They argue that all scenarios point to the economy returning to long-run equilibrium, but note that the policy prescription to delay deficit reduction until after recovery is clearly under way is the most valid.