20.500.12556/RUL-125717 Demand-side or supply-side stabilisation policies in a small euro area economy a case study for Slovenia In this paper we analyse the effectiveness of demand- and supply-side fiscal policies in the small open economy of Slovenia. Simulating the SLOPOL10 model, an econometric model of the Slovenian economy, we analyse the effectiveness of various categories of public spending and taxes during the period 2020 to 2030, assuming that no crisis occurs. Our simulations show that those public spending measures that entail both demand- and supply-side effects are more effective at stimulating real GDP and increasing employment than pure demand-side measures. This is due to the fact that supply-side measures also increase potential and not only actual GDP. Measures which foster research and development and those which improve the education level of the labour force are particularly effective in this respect. Employment can also be stimulated effectively by cutting the income tax rate and the social security contribution rate, i.e. by reducing the tax wedge on labour income, which positively affects Slovenia's international competitiveness. Successful stabilisation policies should thus contain a supply-side component in addition to a demand-side component. We also provide a first simulation of potential effects of the Covid-19 crisis on the Slovenian economy, which is modelled as a combined demand and supply shock. macroeconomics fiscal policy tax policy public expenditure public debt Slovenia stabilisation policy demand management supply-side policies makroekonomija fiskalna politika davčna politika javni izdatki javni dolg management Slovenija true false true Angleški jezik Slovenski jezik Članek v reviji 2021-04-06 09:33:31 2021-04-06 10:00:44 2022-09-05 03:52:14 0000-00-00 00:00:00 2021 0 0 18 str. [in press] 2021 0000-00-00 Zaloznikova Objavljeno NiDoloceno 0000-00-00 0000-00-00 0000-00-00 338 0340-8744 10.1007/s10663-021-09503-y 56761603 29214465 https://link.springer.com/article/10.1007%2Fs10663-021-09503-y 1 https://repozitorij.uni-lj.si/Dokument.php?lang=slv&id=141573 RAZ_Neck_Reinhard_2021.pdf RAZ_Neck_Reinhard_2021.pdf 1 C280B5F9B0A2984478A33894FCC4C607 1bf848297d0e504d2a63878945e5f8ee740bac006b960bbefda588ec2fa28b7a c6a03b9e-a1bb-11eb-a523-00155dcfd717 https://repozitorij.uni-lj.si/Dokument.php?lang=slv&id=141572 Ekonomska fakulteta 0 0 0