Pro-Cyclical bias in fiscal policy (Mello and Moccero)

Luiz de Mello and Diego Moccero published “Brazil´s Fiscal Stance During 1995-2005: The Effect of Indebtednewss on Fiscal Policy over the Business Cycle”, as OECD Woerking Paper n. 485. They calculated: “An increase in debt-to-GDP ratio by 1% is associated with a decrease in discretionary federal speding by 0.33% during 1997-2005”. (PDF in English) Available in: http://www.olis.oecd.org/olis/2006doc.nsf/LinkTo/NT00000AC6/$FILE/JT03210564.PDF