THE PERFORMANCE OF DISCRETIONARY FISCAL POLICIES AND FISCAL RULES AT THE ARGENTINE SUBNATIONAL LEVEL

CORDOBA

Jornada; 55 JORNADAS INTERNACIONALES DE FINANZAS PUBLICAS; 2022

FACULTAD DE CIENCIAS ECONOMICAS (UNC)

In the light of preceding considerations, and based on the growing subnational public finances´ role and importance all over the world, and in particular in Argentina, it is here argued that the field of subnational discretionary fiscal policies deserves extensive research efforts aimed not only at assessing their behaviour in relation to economic cycles (that is, their pro or counter cyclical patterns as determined by the conventional reaction functions) but also to undertaking further investigations on what Larch et al (2020) called the drivers of pro or countercyclical policies. In this connection, the present research faces a twofold objective: on the one hand to show, by the recourse to an enlarged variant of the ?CAPB model? fiscal rule in which dynamic panels including data for the 23 Argentine provinces are econometrically estimated for the period 2005-2019 and, in the second hand to investigate, following Larch et al´s (2020) suggestion, whether the inclusion of the so called ´interaction terms´, may in the Argentine case enrich results of analyses of stabilization properties of subnational discretionary