Fiscal sustainability and dollarization: the case of Ecuador
This article tries to disentangle the dynamic relationships between fiscal variables and economic activity in a small emerging economy characterized by full dollarization, namely, Ecuador. We find that fiscal policy in Ecuador seems to be sustainable, explained by its policy of debt payment through...
| Autores: | , |
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| Tipo de recurso: | artículo |
| Estado: | Versión aceptada para publicación |
| Fecha de publicación: | 2016 |
| País: | España |
| Institución: | Varias* (Consorci de Biblioteques Universitáries de Catalunya, Centre de Serveis Científics i Acadèmics de Catalunya) |
| Repositorio: | Recercat. Dipósit de la Recerca de Catalunya |
| OAI Identifier: | oai:recercat.cat:2445/106564 |
| Acceso en línea: | https://hdl.handle.net/2445/106564 |
| Access Level: | acceso abierto |
| Palabra clave: | Política fiscal Harmonització fiscal Indústria petroliera Producte interior brut Equador Fiscal policy Tax harmonization Petroleum industry and trade Gross domestic product Ecuador |
| Sumario: | This article tries to disentangle the dynamic relationships between fiscal variables and economic activity in a small emerging economy characterized by full dollarization, namely, Ecuador. We find that fiscal policy in Ecuador seems to be sustainable, explained by its policy of debt payment through oil revenues, rather than by a fiscal discipline that dollarization is supposed to encourage. The non-oil tax revenues variable is a purely adjusting variable. This result suggests that in a dollarized country that cannot benefit from the 'seignorage' revenues, the reliance on volatile oil revenues and on smoothing tax revenues leaves the economy's fiscal sustainability vulnerable. |
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