Ricerc@Sapienza

What advice can be given to the policymaker to reduce the burden of public debt after a crisis? In this situation, the debt consolidation calls for fiscal surplus based on increases in taxes and/or reductions in public spending. This paper aims at answering to the above question. Specifically, it evaluates different policy options on the table using the estimated model of the Italian dynamic General Equilibrium Model (IGEM). Our main message is that plans aimed at reducing the public debt based on tax increases rather than expenditure reductions are more effective.

Purpose – The purpose of this paper is to perform an analysis of the current literature providing a deep
contribution to understanding the paradigm shift from output to outcome measures in the public sector. Thus,
the main aim is to provide relevant insights of both theoretical and empirical studies, offering a critique of the
schemes and the research methods used and underlining future research opportunities for the compelling (or
underestimated) contents and new emerging trends.