Estimating Fiscal Space: The Theoretical Framework of Ostry et al. Approach

Akbayir F., YERELİ A. B.

SOSYOEKONOMI, vol.27, no.39, pp.245-256, 2019 (Journal Indexed in ESCI) identifier

  • Publication Type: Article / Article
  • Volume: 27 Issue: 39
  • Publication Date: 2019
  • Doi Number: 10.17233/sosyoekonomi.2019.01.14
  • Title of Journal : SOSYOEKONOMI
  • Page Numbers: pp.245-256


In this paper, it is aimed to examine the theoretical framework of Ostry et al. approach which is one of the methods to estimate fiscal space. In this direction, "fiscal fatigue" and "debt limit" concepts as well as assumptions are tried to explain. In addition, it is examined whether the approach has holistic basis to estimate properly fiscal space of countries. Consequently, it can be said that the approach is based on relatively sound theoretical frameworks. However, whether the approach keeps pace with the new theoretical developments in the literature and countries' unique economic experiences will test the validity and topicality of the approach.