Fiscal crisis in Brazil: causes and remedy
ABSTRACT From 2014 to 2017, Brazil experienced unprecedented fiscal deterioration caused by multidimensional factors. According to the economic literature, to cope with such a crisis, it is recommended to adopt a long-term spending cut-based fiscal consolidation program rather than a tax hike-based...
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| Format: | Article |
| Language: | English |
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Editora 34
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| Series: | Brazilian Journal of Political Economy |
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| Online Access: | http://www.scielo.br/scielo.php?script=sci_arttext&pid=S0101-31572019000100088&lng=en&tlng=en |
| _version_ | 1818880568479186944 |
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| author | MÁRCIO HOLLAND |
| author_facet | MÁRCIO HOLLAND |
| author_sort | MÁRCIO HOLLAND |
| collection | DOAJ |
| description | ABSTRACT From 2014 to 2017, Brazil experienced unprecedented fiscal deterioration caused by multidimensional factors. According to the economic literature, to cope with such a crisis, it is recommended to adopt a long-term spending cut-based fiscal consolidation program rather than a tax hike-based one. However, as the fiscal crisis evolved recently in Brazil, this article brings another perspective to the policy stance. It suggests a fiscal program that includes a combination of spending cuts and tax hikes. On one hand, the peculiarities of the Brazilian government expenditures demand fiscal reforms with long-lasting impacts but generally with low short-term fiscal effect. On the other hand, as short-term fiscal results anchor confidence, increases in taxes would be an important pillar of the economic policies to mitigate the fiscal deterioration in the short term. The GDP contraction is expected to more severe than a simple spending cut measure but is likely to be less prolonged. |
| first_indexed | 2024-12-19T14:48:02Z |
| format | Article |
| id | doaj.art-10ad13dd392447e1a6f60d5f0b2c8cb0 |
| institution | Directory Open Access Journal |
| issn | 1809-4538 |
| language | English |
| last_indexed | 2024-12-19T14:48:02Z |
| publisher | Editora 34 |
| record_format | Article |
| series | Brazilian Journal of Political Economy |
| spelling | doaj.art-10ad13dd392447e1a6f60d5f0b2c8cb02022-12-21T20:16:54ZengEditora 34Brazilian Journal of Political Economy1809-45383918810710.1590/0101-35172019-2918S0101-31572019000100088Fiscal crisis in Brazil: causes and remedyMÁRCIO HOLLANDABSTRACT From 2014 to 2017, Brazil experienced unprecedented fiscal deterioration caused by multidimensional factors. According to the economic literature, to cope with such a crisis, it is recommended to adopt a long-term spending cut-based fiscal consolidation program rather than a tax hike-based one. However, as the fiscal crisis evolved recently in Brazil, this article brings another perspective to the policy stance. It suggests a fiscal program that includes a combination of spending cuts and tax hikes. On one hand, the peculiarities of the Brazilian government expenditures demand fiscal reforms with long-lasting impacts but generally with low short-term fiscal effect. On the other hand, as short-term fiscal results anchor confidence, increases in taxes would be an important pillar of the economic policies to mitigate the fiscal deterioration in the short term. The GDP contraction is expected to more severe than a simple spending cut measure but is likely to be less prolonged.http://www.scielo.br/scielo.php?script=sci_arttext&pid=S0101-31572019000100088&lng=en&tlng=enCrise FiscalEconomia BrasileiraAjustamento FiscalPrograma de Consolidação Fiscal |
| spellingShingle | MÁRCIO HOLLAND Fiscal crisis in Brazil: causes and remedy Brazilian Journal of Political Economy Crise Fiscal Economia Brasileira Ajustamento Fiscal Programa de Consolidação Fiscal |
| title | Fiscal crisis in Brazil: causes and remedy |
| title_full | Fiscal crisis in Brazil: causes and remedy |
| title_fullStr | Fiscal crisis in Brazil: causes and remedy |
| title_full_unstemmed | Fiscal crisis in Brazil: causes and remedy |
| title_short | Fiscal crisis in Brazil: causes and remedy |
| title_sort | fiscal crisis in brazil causes and remedy |
| topic | Crise Fiscal Economia Brasileira Ajustamento Fiscal Programa de Consolidação Fiscal |
| url | http://www.scielo.br/scielo.php?script=sci_arttext&pid=S0101-31572019000100088&lng=en&tlng=en |
| work_keys_str_mv | AT marcioholland fiscalcrisisinbrazilcausesandremedy |