Fiscal Balance During Inflation, Disinflation, and Immigration : Policy Lessons /

The paper provides an overview of the role of the fiscal imbalances and the ensuing public debt in explaining major episodes in Israel's recent economic developments. The main conclusions from the Israeli budgetary developments may have more general validity: (a) deficits lead to inflation and...

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Bibliographic Details
Main Author: Razin, Assaf
Other Authors: Sadka, Efraim
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 1996.
Series:IMF Working Papers; Working Paper ; No. 1996/033
Online Access:Full text available on IMF
Description
Summary:The paper provides an overview of the role of the fiscal imbalances and the ensuing public debt in explaining major episodes in Israel's recent economic developments. The main conclusions from the Israeli budgetary developments may have more general validity: (a) deficits lead to inflation and stopping inflation requires elimination of deficits; (b) a major effect of inflation is a large shift of the tax burden from capital to labor; and (c) shocks to labor supply, such as massive labor inflow through immigration, can be absorbed without worsening government finances, when the labor and the housing markets are sufficiently flexible.
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Physical Description:1 online resource (44 pages)
Format:Mode of access: Internet
ISSN:1018-5941
Access:Electronic access restricted to authorized BRAC University faculty, staff and students