Additional Evidence
According to some empirical research by economists at this institution, expenditure-based fiscal adjustments were more stable and durable than revenue-based strategies during the 1980s in Latin American and African countries running structural adjustment programs.
But, despite the words of a prominent supply-side economist, Robert Mundell, who stated that "fiscal discipline is a learned behavior", there is no economic reason to tie the hands of politicians to tight constantly balanced budgets, because it is possible to keep fiscal discipline along the time, balancing deficits and surpluses according to the business cycle, as Neo-Keynesian Economics supports. In fact, many developed nations, including the United States, Germany, France or Italy, carried out neo-Keynesian fiscal policies during the recession of 2002.
Read more about this topic: Fiscal Adjustment
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