Capros P. and P. Karadeloglou (1993) "Structural Adjustment and Public Deficit: A Computable General Equilibrium Modelling Analysis for Greece", in P. Capros and D. Meulders (editors) "Budgetary Policy Modelling: Public Expenditure", Routledge Publ. Co., Chapman and Hall, London, book published in 1996
The paper presents a dynamic computable general equilibrium of the Greek economy and its use in the analysis of public deficit reduction policies under different market clearing regimes and financial system closures. The model is a large-scale econometrically estimated system that incorporates an IS-LM closure, allows for different market regimes and involves multiple sectors. Six public policy measures are analysed under three cases of structural adjustments, concerning the labour market and the exchange rate regimes. The measures are all found to contribute to the reduction of the deficits in both the public budget and the current account, while inducing positive growth effects and triggering a deflationary process. Rigid market clearing regimes weaken the effects and sometimes have adverse effects. The measures are found to differ in effectiveness, as well as in wealth distribution by economic agent.
For more information you can download the following related file(s):
