| Titre : | Does the composition of government spending matter for government bond spreads? (2021) |
| Auteurs : | Jean-Louis Combes, Auteur ; Alexandru Minea, Auteur ; Sawadogo, Pegdéwendé Nestor, Auteur |
| Type de document : | Article : Revues - Articles |
| Dans : | Economic Modelling (Vol. 96, March 2021) |
| Langues: | Anglais |
| Catégories : |
[Eurovoc] FINANCES > fiscalité > politique fiscale [Eurovoc] FINANCES > investissement et financement > investissement > investissement public [JEL] G - Économie financière > G1 - Marchés financiers généraux > G12 - Prix des actifs [JEL] H - Économie publique > H6 - Budget national, déficit et dette > H63 - Dette et gestion de la dette |
| Tags : | government bond spreads ; government current spending ; public investment |
| Résumé : | This paper contributes to the literature on fiscal policy as a determinant of government bond spreads. We analyze the effect of government spending on government bond spreads using a panel of 30 emerging countries during the period 2000–2013. Based on system-GMM estimations, we find that total public spending does not affect government bond spreads. Instead, we reveal a composition effect: higher current spending (public investment) increase (decrease) government bond spreads. This result may arise due to the fact that current (less productive) spending may be associated with lower growth prospects, making investors to require higher premia. Finally, we unveil nonlinearities driven by the quality of institutions: in particular, good institutions support a more favorable impact of current spending on government bond spreads. Our findings suggest that governments of emerging countries can improve their international financing conditions by reducing current spending and supporting public investment. |
| Doi : |
DOI : 10.1016/j.econmod.2020.03.025 
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| Axe de recherche : | Financement du développement |
| En ligne : | https://hal.archives-ouvertes.fr/hal-02887274 |
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