Dealing with the COVID-19 pandemic in Slovenia : simulations with a macroeconometric model

Weyerstrass, Klaus (author), Blueschke, Dmitri (author), Neck, Reinhard (author), Verbič, Miroslav (author)

In this paper we analyse the effectiveness of fiscal policies with respect to macroeconomic stabilisation during the COVID-19 pandemic in the small open economy of Slovenia. Using SLOPOL11, an econometric model of the Slovenian economy, we simulate the development of the its economy during the 2020s under alternative assumptions about future pandemic-related shocks. We also determine optimal fiscal policies to combat the effects of the pandemic and to stabilise the economy under two scenarios for the future course of developments under COVID-19. Our simulations show that those public spending measures that entail both demand- and sup- ply-side effects are more effective at stimulating real GDP and increasing employ ment than pure demand-side measures. Successful stabilisation policies should thus contain a supply-side component in addition to a demand-side component.

• Language: English
• Keywords: macroeconomics, fiscal policy, tax policy, Slovenia, stabilisation policy, policy optimisation, public expenditure, demand management, supply-side policies, public debt
• Work type: Article
• Typology: 1.01 - Original Scientific Article
• Organization: EF - School of Economics and Business
• Publication status: Published
• Publication version: Version of Record
• Year: 2023
• Number of pages: Str. 863-881
• Numbering: Vol. 50
• PID: 20.500.12556/RUL-159703
• UDC: 330.3
• ISSN on article: 0340-8744
• DOI: 10.1007/s10663-023-09591-y
• COBISS.SI-ID: 168526851
• Publication date in RUL: 18.07.2024

Record is a part of a journal

• Title: Empirica
• Shortened title: Empirica
• Publisher: Springer
• ISSN: 0340-8744
• COBISS.SI-ID: 29214465

Licences

• License: CC BY 4.0, Creative Commons Attribution 4.0 International
• Link: http://creativecommons.org/licenses/by/4.0/
• Description: This is the standard Creative Commons license that gives others maximum freedom to do what they want with the work as long as they credit the author.

Secondary language

• Language: Slovenian
• Keywords: makroekonomija, fiskalna politika, davčna politika, Slovenija

Projects

• Funder: FWF - Austrian Science Fund
• Funding programme: Austrian Science Fund (FWF)
• Project number: I 2764-G27
• Name: Public spending and fiscal multipliers under various policy mixes

• Funder: ARIS - Slovenian Research and Innovation Agency
• Project number: 630-31/2016-1