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Spanish Public Finances through the Financial Crisis
Author(s) -
Martí Francisco,
Pérez Javier J.
Publication year - 2015
Publication title -
fiscal studies
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.63
H-Index - 40
eISSN - 1475-5890
pISSN - 0143-5671
DOI - 10.1111/j.1475-5890.2015.12079
Subject(s) - financial crisis , fiscal policy , economics , public spending , debt , framing (construction) , economic policy , fiscal union , public sector , public finance , financial system , finance , macroeconomics , political science , economy , structural engineering , politics , law , engineering
Spain's public finances have been under significant stress during the financial crisis, despite pre‐crisis fiscal surpluses and low levels of public debt. The impact of the crisis and an initial phase of countercyclical activism exacerbated the existing (structural) fiscal vulnerabilities. To correct the fiscal imbalances, a significant number of bold policy actions were taken, affecting taxation, public spending, national fiscal rules and the structure of the public sector. In this paper, we discuss the evolution of the public finances in Spain through the financial crisis, framing crisis‐related fiscal policy measures within medium‐term economic trends and focusing on policy responses to the crisis. We also touch upon the main policy challenges ahead.