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Please use this identifier to cite or link to this item: http://hdl.handle.net/10400.5/2749

Title: Government indebtedness and european consumers behaviour
Authors: Afonso, António
Keywords: Deficit finance
Ricardian equivalence
Private consumption
European Union
panel data
Issue Date: 2001
Publisher: ISEG – Departamento de Economia
Citation: Afonso, António. 2001. "Government indebtedness and european consumers behaviour". Instituto Superior de Economia e Gestão - DE Working papers nº 12-2001/DE/CISEP
Series/Report no.: DE Working papers;nº 12-2001/DE/CISEP
Abstract: According to conventional macroeconomics, public debt has a significant effect on the economy since consumers see public debt as net wealth, however, according to the Ricardian Equivalence hypothesis, that effect would be absent. This paper's results, obtained from Euler equation estimations, using a panel data approach, indicate that it would be wise to reject the debt neutrality hypothesis for the EU-15. However, estimations carried out after dividing the countries into two groups, tentatively allow us to conclude that private consumption in "less indebted" countries seems to be more responsive to wealth increases than in the "more indebted" countries.
URI: http://hdl.handle.net/10400.5/2749
ISSN: 0874-4548
Publisher version: https://aquila1.iseg.utl.pt/aquila/getFile.do?method=getFile&fileId=23822
Appears in Collections:CISEP - Documentos de Trabalho / CISEP - Working Papers
DE - Documentos de trabalho / Working Papers

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