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Table 5 Time-varying Okun’s coefficient and types of fiscal consolidations

From: A fiscal job? An analysis of fiscal policy and the labor market

 

Time-varying Okun’s coefficient (employment)

 

(1)

(2)

(3)

(4)

(5)

(6)

Central Bank policy rate (−1)

−0.244*

−0.240*

−0.250**

−0.246**

−0.247**

−0.243*

 

(0.120)

(0.122)

(0.119)

(0.120)

(0.120)

(0.121)

Employment protection legislation

−0.0967**

−0.0972**

−0.100**

−0.0986**

−0.0983**

−0.0985**

 

(0.0379)

(0.0380)

(0.0385)

(0.0386)

(0.0387)

(0.0387)

Dummy output expansion

 

0.00828

 

0.00998

 

0.00990

  

(0.00845)

 

(0.00694)

 

(0.00705)

Expenditure-based consolidation GP

0.0507**

0.0531**

    
 

(0.0223)

(0.0248)

    

Revenue-based consolidation GP

0.0143

−0.0120

    
 

(0.0533)

(0.0715)

    

Expenditure-based consolidation GP*Output expansion

 

−0.00341

    
  

(0.0281)

    

Revenue-based consolidation GP*Output expansion

 

0.0398

    
  

(0.0548)

    

Expenditure-based consolidation AA

  

0.0395*

0.0534**

  
   

(0.0205)

(0.0239)

  

Revenue-based consolidation AA

  

0.0420

0.0234

  
   

(0.0266)

(0.0335)

  

Expenditure-based consolidation AA*Output expansion

   

−0.0353

  
    

(0.0335)

  

Revenue-based consolidation AA*Output expansion

   

0.0386

  
    

(0.0328)

  

Observations

747

747

747

747

747

747

R-squared

0.752

0.752

0.751

0.752

0.752

0.752

Country

33

33

33

33

33

33

  1. Note: Robust standard errors in parentheses
  2. ***p < 0.01, **p < 0.05, *p < 0.1
  3. GP refers to fiscal episodes captured following Giavazzi and Pagano (1996) and AA refers to fiscal episodes captured following Alesina and Ardagna (1998)