Estimation of short-run effects of fiscal policy in Ireland, 1960-1970

Abstract

Apart from input-output studies, little effort appears to have been made to construct general-purpose macro-economic models of the Irish economy. A paper by Brendan Walsh is one exception. (See his "Econometric Macro-Model Building in the Irish Context", ESRI Quarterly Economic Commentary, June 1970.) The present study is an attempt to move some small distance in filling the significant gap which still remains in the macro-economic analysis of the economy. Apart from their possible academic interest, models of the kind developed here should be of interest to Government as guides in the formation of budgetary policy. The model constructed in this paper may also be of interest to banks and large industrial firms concerned with macro-economic forecasting as a basis for their own short-run planning.