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How Does Fiscal Policy Affect GDP and Inflation in Ukraine?

Visnyk of the National Bank of Ukraine, 2018, No. 244, pp. 25-43


How Does Fiscal Policy Affect GDP and Inflation in Ukraine?

Artem Vdovychenko ab

a National Bank of Ukraine, Kyiv, Ukraine


In this study, we apply the Blanchard-Perotti approach to estimating the impact of fiscal policy on GDP and inflation in Ukraine. By disaggregating fiscal data, we were able to determine which items of the budget have the most influence on real GDP and inflation. Our results show that fiscal multipliers in Ukraine in absolute values are higher for budget expenditures than for taxes. In addition, both budget expenditures and taxes have a positive impact on inflation.

JEL Codes: E62, H3, H61, C22

Keywords: fiscal multiplier, fiscal policy, fiscal shocks, VAR

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Citation: Vdovychenko A. (2018). How Does Fiscal Policy Affect GDP and Inflation in Ukraine? Visnyk of the National Bank of Ukraine, No. 244, pp. 25-43. https://doi.org/10.26531/vnbu2018.244.02

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