Skip to content

EUROMOD Working Paper Series EM5/15

The design of fiscal consolidation measures in the European Union: distributional effects and implications for macroeconomic recovery

Authors

Publication date

27 Mar 2015

Abstract

The financial and economic crisis which started in the late 2000s and the fiscal consolidation measures to counter the subsequent government budget deficits have an impact on household income distribution and macroeconomic recovery. We consider the austerity measures in relation to their distributional impact and the potential channels through which fiscal consolidation can affect economic growth. We find notable variation in the size, composition and effects of fiscal consolidation. Richer households tend to bear a greater burden in most countries but spending cuts are more likely to affect liquidity constrained households casting doubts over previous findings in the macro-economic literature about the effectiveness of such measures. This suggests the need to consider more disaggregated evidence to reach robust policy conclusions.

Subjects

Income Dynamics, Household Economics, Microsimulation, and Economic Policy

Paper download  


Related publications

  1. The design of fiscal consolidation measures in the European Union: distributional effects and implications for macroeconomic recovery

    Francesco Figari, Alari Paulus, and Holly Sutherland

    1. Income Dynamics
    2. Household Economics
    3. Microsimulation
    4. Economic Policy

#523022


Research home

Research home

News

Latest findings, new research

Publications search

Search all research by subject and author

Podcasts

Researchers discuss their findings and what they mean for society

Projects

Background and context, methods and data, aims and outputs

Events

Conferences, seminars and workshops

Survey methodology

Specialist research, practice and study

Taking the long view

ISER's annual report

Themes

Key research themes and areas of interest