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Budget deficits and social protection: cyclical government expenditure in the OECD

Research output: Contribution to journalJournal article

Published
<mark>Journal publication date</mark>31/12/2012
<mark>Journal</mark>Economics Letters
Issue number3
Volume117
Number of pages3
Pages (from-to)909-911
Publication statusPublished
Early online date16/07/12
Original languageEnglish

Abstract

Countercyclical government spending offers social protection to the vulnerable when economies move into recession. This paper questions the extent to which governments are able to spend countercyclically and the extent to which social expenditures are likely to be countercyclical. An analysis of public spending in OECD countries (1980–2005) suggests countercyclical social protection is constrained by the limits to public borrowing and the degree of political polarization.