The Effects of Fiscal Consolidations: Theory and Evidence

For comments we thank Edoardo Acabbi, Daniel Cohen, Harald Hulig, and participants in the 2016 ASSA Meetings in San Francisco, at the 2015 ECFIN workshop “Expenditure-based consolidations: experiences and outcomes”, at CEPR’s 2015 ESSIM and at seminars at the NY Fed, the IMF, the University of Stockholm, the University of Chicago, Booth and the Paris School of Economics. We also thank Gualtiero Azzalini, Igor Cerasa, Giorgio Saponaro, Daniele Imperiale, Armando Miano and Lorenzo Rigon for outstanding research assistance. We gratefully acknowledge the support of IGIER at Bocconi University and of the Italian Ministry for Research and Universities through a 2015 PRIN grant prot. 2015FMRE5X. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.

• May 2, 2017