Abstract

RAMIREZ CEDILLO, Eduardo. Por una política fiscal contracíclica. Prob. Des [online]. 2006, vol.37, n.147, pp.81-108. ISSN 0301-7036.

The fiscal stance of the Latin American economies and many developing economies has maintained a pro-cyclical character which has played an important role in the instability they experience, unlike what happens in the developed countries, which utilize their fiscal policy to limit the pressures from the economic cycle. In this respect, the study enunciates some explanations, such as exposure to the volatility of financial capital and the inadequate use of spending policy in times of economic boom, impeding its increase in periods of recession and its counter-cyclical management. In the present study, using the Hodrick-Prescott filter (1997), the pro-cyclicality of fiscal policy in the period 1980-2004 is demonstrated for Mexico, and it is assumed that while a healthy public finance policy was maintained, it was oriented in the same direction. In addition, an alternative is proposed in which a counter-cyclical fiscal policy is operated.

Keywords : fiscal policy; economic cycle; public finances; volatility; public employment.