The strong increase of Austrian government debt in the Kreisky era: Austro-Keynesianism or just stubborn forecast errors?

In the Kreisky era (1970–1983), Austrian government debts increased strongly. Historically, the attitude of Kreisky and the Social Democrats towards Keynesian fiscal policy measures to fight unemployment during the oil crises has been held to be responsible for the successive budget deficits. Kreisk...

Full description

Saved in:
Bibliographic Details
Published in:Empirica 2019-05, Vol.46 (2), p.229-248
Main Authors: Brugger, Florian, Kleinert, Jörn
Format: Article
Language:English
Subjects:
Budget deficits
Crises
Debt
Econometrics
Economic models
Economics
Economics and Finance
Errors
European Integration
Fiscal policy
GDP
Gross Domestic Product
Growth rate
Industrial Organization
International Economics
Keynesian theory
Macroeconomics/Monetary Economics//Financial Economics
Original Paper
Petroleum
Public debt
Public Finance
Unemployment
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
cited_by cdi_FETCH-LOGICAL-c424t-a3496b2217af2a46f82f8142ad26f082eb3dd9830bea4e2268c2eccbf3c2dbf23
cites cdi_FETCH-LOGICAL-c424t-a3496b2217af2a46f82f8142ad26f082eb3dd9830bea4e2268c2eccbf3c2dbf23
container_end_page 248
container_issue 2
container_start_page 229
container_title Empirica
container_volume 46
creator Brugger, Florian
Kleinert, Jörn
description In the Kreisky era (1970–1983), Austrian government debts increased strongly. Historically, the attitude of Kreisky and the Social Democrats towards Keynesian fiscal policy measures to fight unemployment during the oil crises has been held to be responsible for the successive budget deficits. Kreisky’s ideological debt policy has become a narrative that has strongly influenced Austrian fiscal policy until today. While this explanation for the strong increase in public debt during the Kreisky era is widely accepted, it is not necessarily true. In this paper, we assess a different explanation: the deficits might simply have resulted from forecast errors of GDP growth in those turbulent times. We find that about one-third of the increase in the debt-over-GDP ratio is directly explained by short-run forecast errors, i.e., the difference between the approved and the realized budget, and an additional one-fifth is the lower bound of forecast error regarding the long-run growth rate.
doi_str_mv 10.1007/s10663-017-9396-0
format article
fullrecord <record><control><sourceid>proquest_cross</sourceid><recordid>TN_cdi_proquest_journals_2008703401</recordid><sourceformat>XML</sourceformat><sourcesystem>PC</sourcesystem><sourcerecordid>2008703401</sourcerecordid><originalsourceid>FETCH-LOGICAL-c424t-a3496b2217af2a46f82f8142ad26f082eb3dd9830bea4e2268c2eccbf3c2dbf23</originalsourceid><addsrcrecordid>eNp1kEtLAzEUhYMoWB8_wF3AdfTm4TzcSCm-qOBG1yEzc1On2kRvpsL8e1NGcOUq3MN3TuBj7EzChQQoL5OEotACZClqXRcC9thMXpVaFLWU-2wG2oCoSmMO2VFKawCo8zFj48sb8jRQDCveh5bQJeTR8_k2h70LfBW_kcIGw8A7bIYM8SFXloR9eh85krue4CiWOAZMudSnDY_E1znO29umiRS4j4StywkSRUo3J-zAu4-Ep7_vMXu9u31ZPIin5_vHxfxJtEaZQTht6qJRSpbOK2cKXylfSaNcpwoPlcJGd11daWjQGVSqqFqFbdt43aqu8Uofs_Np95Pi1xbTYNdxSyF_aRVAVe7MyEzJiWoppkTo7Sf1G0ejlWB3hu1k2GbDdmfYQu6oqZMyG1ZIf8v_l34AQ32AjQ</addsrcrecordid><sourcetype>Aggregation Database</sourcetype><iscdi>true</iscdi><recordtype>article</recordtype><pqid>2008703401</pqid></control><display><type>article</type><title>The strong increase of Austrian government debt in the Kreisky era: Austro-Keynesianism or just stubborn forecast errors?</title><source>International Bibliography of the Social Sciences (IBSS)</source><source>ABI/INFORM Global</source><source>Politics Collection</source><source>Springer Nature</source><source>Social Science Premium Collection (Proquest) (PQ_SDU_P3)</source><source>PAIS Index</source><creator>Brugger, Florian ; Kleinert, Jörn</creator><creatorcontrib>Brugger, Florian ; Kleinert, Jörn</creatorcontrib><description>In the Kreisky era (1970–1983), Austrian government debts increased strongly. Historically, the attitude of Kreisky and the Social Democrats towards Keynesian fiscal policy measures to fight unemployment during the oil crises has been held to be responsible for the successive budget deficits. Kreisky’s ideological debt policy has become a narrative that has strongly influenced Austrian fiscal policy until today. While this explanation for the strong increase in public debt during the Kreisky era is widely accepted, it is not necessarily true. In this paper, we assess a different explanation: the deficits might simply have resulted from forecast errors of GDP growth in those turbulent times. We find that about one-third of the increase in the debt-over-GDP ratio is directly explained by short-run forecast errors, i.e., the difference between the approved and the realized budget, and an additional one-fifth is the lower bound of forecast error regarding the long-run growth rate.</description><identifier>ISSN: 0340-8744</identifier><identifier>EISSN: 1573-6911</identifier><identifier>DOI: 10.1007/s10663-017-9396-0</identifier><language>eng</language><publisher>New York: Springer US</publisher><subject>Budget deficits ; Crises ; Debt ; Econometrics ; Economic models ; Economics ; Economics and Finance ; Errors ; European Integration ; Fiscal policy ; GDP ; Gross Domestic Product ; Growth rate ; Industrial Organization ; International Economics ; Keynesian theory ; Macroeconomics/Monetary Economics//Financial Economics ; Original Paper ; Petroleum ; Public debt ; Public Finance ; Unemployment</subject><ispartof>Empirica, 2019-05, Vol.46 (2), p.229-248</ispartof><rights>The Author(s) 2018</rights><rights>Empirica is a copyright of Springer, (2018). All Rights Reserved. © 2018. This work is published under http://creativecommons.org/licenses/by/4.0/ (the “License”). Notwithstanding the ProQuest Terms and Conditions, you may use this content in accordance with the terms of the License.</rights><oa>free_for_read</oa><woscitedreferencessubscribed>false</woscitedreferencessubscribed><citedby>FETCH-LOGICAL-c424t-a3496b2217af2a46f82f8142ad26f082eb3dd9830bea4e2268c2eccbf3c2dbf23</citedby><cites>FETCH-LOGICAL-c424t-a3496b2217af2a46f82f8142ad26f082eb3dd9830bea4e2268c2eccbf3c2dbf23</cites><orcidid>0000-0002-1167-9245</orcidid></display><links><openurl>$$Topenurl_article</openurl><openurlfulltext>$$Topenurlfull_article</openurlfulltext><thumbnail>$$Tsyndetics_thumb_exl</thumbnail><linktopdf>$$Uhttps://www.proquest.com/docview/2008703401/fulltextPDF?pq-origsite=primo$$EPDF$$P50$$Gproquest$$H</linktopdf><linktohtml>$$Uhttps://www.proquest.com/docview/2008703401?pq-origsite=primo$$EHTML$$P50$$Gproquest$$H</linktohtml><link.rule.ids>314,780,784,11688,12847,21387,21394,27866,27924,27925,33223,33611,33985,36060,43733,43948,44363,74221,74468,74895</link.rule.ids></links><search><creatorcontrib>Brugger, Florian</creatorcontrib><creatorcontrib>Kleinert, Jörn</creatorcontrib><title>The strong increase of Austrian government debt in the Kreisky era: Austro-Keynesianism or just stubborn forecast errors?</title><title>Empirica</title><addtitle>Empirica</addtitle><description>In the Kreisky era (1970–1983), Austrian government debts increased strongly. Historically, the attitude of Kreisky and the Social Democrats towards Keynesian fiscal policy measures to fight unemployment during the oil crises has been held to be responsible for the successive budget deficits. Kreisky’s ideological debt policy has become a narrative that has strongly influenced Austrian fiscal policy until today. While this explanation for the strong increase in public debt during the Kreisky era is widely accepted, it is not necessarily true. In this paper, we assess a different explanation: the deficits might simply have resulted from forecast errors of GDP growth in those turbulent times. We find that about one-third of the increase in the debt-over-GDP ratio is directly explained by short-run forecast errors, i.e., the difference between the approved and the realized budget, and an additional one-fifth is the lower bound of forecast error regarding the long-run growth rate.</description><subject>Budget deficits</subject><subject>Crises</subject><subject>Debt</subject><subject>Econometrics</subject><subject>Economic models</subject><subject>Economics</subject><subject>Economics and Finance</subject><subject>Errors</subject><subject>European Integration</subject><subject>Fiscal policy</subject><subject>GDP</subject><subject>Gross Domestic Product</subject><subject>Growth rate</subject><subject>Industrial Organization</subject><subject>International Economics</subject><subject>Keynesian theory</subject><subject>Macroeconomics/Monetary Economics//Financial Economics</subject><subject>Original Paper</subject><subject>Petroleum</subject><subject>Public debt</subject><subject>Public Finance</subject><subject>Unemployment</subject><issn>0340-8744</issn><issn>1573-6911</issn><fulltext>true</fulltext><rsrctype>article</rsrctype><creationdate>2019</creationdate><recordtype>article</recordtype><sourceid>7TQ</sourceid><sourceid>8BJ</sourceid><sourceid>ALSLI</sourceid><sourceid>DPSOV</sourceid><sourceid>M0C</sourceid><sourceid>M2L</sourceid><recordid>eNp1kEtLAzEUhYMoWB8_wF3AdfTm4TzcSCm-qOBG1yEzc1On2kRvpsL8e1NGcOUq3MN3TuBj7EzChQQoL5OEotACZClqXRcC9thMXpVaFLWU-2wG2oCoSmMO2VFKawCo8zFj48sb8jRQDCveh5bQJeTR8_k2h70LfBW_kcIGw8A7bIYM8SFXloR9eh85krue4CiWOAZMudSnDY_E1znO29umiRS4j4StywkSRUo3J-zAu4-Ep7_vMXu9u31ZPIin5_vHxfxJtEaZQTht6qJRSpbOK2cKXylfSaNcpwoPlcJGd11daWjQGVSqqFqFbdt43aqu8Uofs_Np95Pi1xbTYNdxSyF_aRVAVe7MyEzJiWoppkTo7Sf1G0ejlWB3hu1k2GbDdmfYQu6oqZMyG1ZIf8v_l34AQ32AjQ</recordid><startdate>20190501</startdate><enddate>20190501</enddate><creator>Brugger, Florian</creator><creator>Kleinert, Jörn</creator><general>Springer US</general><general>Springer Nature B.V</general><scope>C6C</scope><scope>AAYXX</scope><scope>CITATION</scope><scope>0-V</scope><scope>3V.</scope><scope>7TQ</scope><scope>7WY</scope><scope>7WZ</scope><scope>7XB</scope><scope>87Z</scope><scope>8AO</scope><scope>8BJ</scope><scope>8FK</scope><scope>8FL</scope><scope>8G5</scope><scope>ABUWG</scope><scope>AFKRA</scope><scope>ALSLI</scope><scope>AZQEC</scope><scope>BENPR</scope><scope>BEZIV</scope><scope>CCPQU</scope><scope>DHY</scope><scope>DON</scope><scope>DPSOV</scope><scope>DWQXO</scope><scope>FQK</scope><scope>FRNLG</scope><scope>F~G</scope><scope>GNUQQ</scope><scope>GUQSH</scope><scope>JBE</scope><scope>K60</scope><scope>K6~</scope><scope>KC-</scope><scope>L.-</scope><scope>M0C</scope><scope>M2L</scope><scope>M2O</scope><scope>MBDVC</scope><scope>PQBIZ</scope><scope>PQBZA</scope><scope>PQEST</scope><scope>PQQKQ</scope><scope>PQUKI</scope><scope>Q9U</scope><orcidid>https://orcid.org/0000-0002-1167-9245</orcidid></search><sort><creationdate>20190501</creationdate><title>The strong increase of Austrian government debt in the Kreisky era: Austro-Keynesianism or just stubborn forecast errors?</title><author>Brugger, Florian ; Kleinert, Jörn</author></sort><facets><frbrtype>5</frbrtype><frbrgroupid>cdi_FETCH-LOGICAL-c424t-a3496b2217af2a46f82f8142ad26f082eb3dd9830bea4e2268c2eccbf3c2dbf23</frbrgroupid><rsrctype>articles</rsrctype><prefilter>articles</prefilter><language>eng</language><creationdate>2019</creationdate><topic>Budget deficits</topic><topic>Crises</topic><topic>Debt</topic><topic>Econometrics</topic><topic>Economic models</topic><topic>Economics</topic><topic>Economics and Finance</topic><topic>Errors</topic><topic>European Integration</topic><topic>Fiscal policy</topic><topic>GDP</topic><topic>Gross Domestic Product</topic><topic>Growth rate</topic><topic>Industrial Organization</topic><topic>International Economics</topic><topic>Keynesian theory</topic><topic>Macroeconomics/Monetary Economics//Financial Economics</topic><topic>Original Paper</topic><topic>Petroleum</topic><topic>Public debt</topic><topic>Public Finance</topic><topic>Unemployment</topic><toplevel>online_resources</toplevel><creatorcontrib>Brugger, Florian</creatorcontrib><creatorcontrib>Kleinert, Jörn</creatorcontrib><collection>SpringerOpen</collection><collection>CrossRef</collection><collection>ProQuest Social Sciences Premium Collection</collection><collection>ProQuest Central (Corporate)</collection><collection>PAIS Index</collection><collection>ABI/INFORM Collection</collection><collection>ABI/INFORM Global (PDF only)</collection><collection>ProQuest Central (purchase pre-March 2016)</collection><collection>ABI/INFORM Global (Alumni Edition)</collection><collection>ProQuest Pharma Collection</collection><collection>International Bibliography of the Social Sciences (IBSS)</collection><collection>ProQuest Central (Alumni) (purchase pre-March 2016)</collection><collection>ABI/INFORM Collection (Alumni Edition)</collection><collection>Research Library (Alumni Edition)</collection><collection>ProQuest Central (Alumni)</collection><collection>ProQuest Central</collection><collection>Social Science Premium Collection (Proquest) (PQ_SDU_P3)</collection><collection>ProQuest Central Essentials</collection><collection>ProQuest Central</collection><collection>Business Premium Collection</collection><collection>ProQuest One Community College</collection><collection>PAIS International</collection><collection>PAIS International (Ovid)</collection><collection>Politics Collection</collection><collection>ProQuest Central Korea</collection><collection>International Bibliography of the Social Sciences</collection><collection>Business Premium Collection (Alumni)</collection><collection>ABI/INFORM Global (Corporate)</collection><collection>ProQuest Central Student</collection><collection>Research Library Prep</collection><collection>International Bibliography of the Social Sciences</collection><collection>ProQuest Business Collection (Alumni Edition)</collection><collection>ProQuest Business Collection</collection><collection>ProQuest Politics Collection</collection><collection>ABI/INFORM Professional Advanced</collection><collection>ABI/INFORM Global</collection><collection>Political Science Database</collection><collection>Research Library</collection><collection>Research Library (Corporate)</collection><collection>ProQuest One Business</collection><collection>ProQuest One Business (Alumni)</collection><collection>ProQuest One Academic Eastern Edition (DO NOT USE)</collection><collection>ProQuest One Academic</collection><collection>ProQuest One Academic UKI Edition</collection><collection>ProQuest Central Basic</collection><jtitle>Empirica</jtitle></facets><delivery><delcategory>Remote Search Resource</delcategory><fulltext>fulltext</fulltext></delivery><addata><au>Brugger, Florian</au><au>Kleinert, Jörn</au><format>journal</format><genre>article</genre><ristype>JOUR</ristype><atitle>The strong increase of Austrian government debt in the Kreisky era: Austro-Keynesianism or just stubborn forecast errors?</atitle><jtitle>Empirica</jtitle><stitle>Empirica</stitle><date>2019-05-01</date><risdate>2019</risdate><volume>46</volume><issue>2</issue><spage>229</spage><epage>248</epage><pages>229-248</pages><issn>0340-8744</issn><eissn>1573-6911</eissn><abstract>In the Kreisky era (1970–1983), Austrian government debts increased strongly. Historically, the attitude of Kreisky and the Social Democrats towards Keynesian fiscal policy measures to fight unemployment during the oil crises has been held to be responsible for the successive budget deficits. Kreisky’s ideological debt policy has become a narrative that has strongly influenced Austrian fiscal policy until today. While this explanation for the strong increase in public debt during the Kreisky era is widely accepted, it is not necessarily true. In this paper, we assess a different explanation: the deficits might simply have resulted from forecast errors of GDP growth in those turbulent times. We find that about one-third of the increase in the debt-over-GDP ratio is directly explained by short-run forecast errors, i.e., the difference between the approved and the realized budget, and an additional one-fifth is the lower bound of forecast error regarding the long-run growth rate.</abstract><cop>New York</cop><pub>Springer US</pub><doi>10.1007/s10663-017-9396-0</doi><tpages>20</tpages><orcidid>https://orcid.org/0000-0002-1167-9245</orcidid><oa>free_for_read</oa></addata></record>
fulltext fulltext
identifier ISSN: 0340-8744
ispartof Empirica, 2019-05, Vol.46 (2), p.229-248
issn 0340-8744
1573-6911
language eng
recordid cdi_proquest_journals_2008703401
source International Bibliography of the Social Sciences (IBSS); ABI/INFORM Global; Politics Collection; Springer Nature; Social Science Premium Collection (Proquest) (PQ_SDU_P3); PAIS Index
subjects Budget deficits
Crises
Debt
Econometrics
Economic models
Economics
Economics and Finance
Errors
European Integration
Fiscal policy
GDP
Gross Domestic Product
Growth rate
Industrial Organization
International Economics
Keynesian theory
Macroeconomics/Monetary Economics//Financial Economics
Original Paper
Petroleum
Public debt
Public Finance
Unemployment
title The strong increase of Austrian government debt in the Kreisky era: Austro-Keynesianism or just stubborn forecast errors?
url http://sfxeu10.hosted.exlibrisgroup.com/loughborough?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&ctx_tim=2024-12-29T14%3A56%3A23IST&url_ver=Z39.88-2004&url_ctx_fmt=infofi/fmt:kev:mtx:ctx&rfr_id=info:sid/primo.exlibrisgroup.com:primo3-Article-proquest_cross&rft_val_fmt=info:ofi/fmt:kev:mtx:journal&rft.genre=article&rft.atitle=The%20strong%20increase%20of%20Austrian%20government%20debt%20in%20the%20Kreisky%20era:%20Austro-Keynesianism%20or%20just%20stubborn%20forecast%20errors?&rft.jtitle=Empirica&rft.au=Brugger,%20Florian&rft.date=2019-05-01&rft.volume=46&rft.issue=2&rft.spage=229&rft.epage=248&rft.pages=229-248&rft.issn=0340-8744&rft.eissn=1573-6911&rft_id=info:doi/10.1007/s10663-017-9396-0&rft_dat=%3Cproquest_cross%3E2008703401%3C/proquest_cross%3E%3Cgrp_id%3Ecdi_FETCH-LOGICAL-c424t-a3496b2217af2a46f82f8142ad26f082eb3dd9830bea4e2268c2eccbf3c2dbf23%3C/grp_id%3E%3Coa%3E%3C/oa%3E%3Curl%3E%3C/url%3E&rft_id=info:oai/&rft_pqid=2008703401&rft_id=info:pmid/&rfr_iscdi=true