Democracy and fiscal-policy responses to COVID-19

Elgin, Ceyhun, Abdullah, Yalaman and Yasar, Sezer 2021. Democracy and fiscal-policy responses to COVID-19. [Working Paper]. CAMA Working Paper No. 62/2021, SSRN. Available at: http://dx.doi.org/10.2139/ssrn.3883053

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Abstract

In this paper, we investigate the relationship between the level of democracy and fiscal-policy response to the economic crisis induced by the COVID-19 pandemic. We use a novel cross-country dataset of fiscal-policy responses with time variation. Our results suggest that more democratic countries adopted substantially larger fiscal-policy packages (in % GDP) and the gap regarding the size of packages between more democratic and less democratic countries widened over time. Moreover, our regressions with different measures of democracy as well as instrumental variable estimations support a robust and causal relationship between a higher level of democracy and a larger fiscal-package size.

Item Type:	Monograph (Working Paper)
Date Type:	Publication
Status:	Published
Schools:	Schools > Business (Including Economics)
Publisher:	SSRN
Date of First Compliant Deposit:	1 February 2025
Date of Acceptance:	2021
Last Modified:	17 Feb 2025 10:30
URI:	https://orca.cardiff.ac.uk/id/eprint/175823

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