Kemer Sıkma Politikalarındaki Büyük Risk: Mali Tuzak
Great Risk in Austerity Policies: Fiscal Trap

Summary/Abstract: Because of the global financial crisis, especially the 2008 one, many countries have been left in a difficult situation. The application of policies implemented to overcome the crisis which involve tax increases and cuts in public spending has led to a lot of adverse effects on many countries' economies. Tax increases and public spending cuts have slowed down economic growth. This has caused a decrease in tax revenues therefore budget deficits have started to grow. This process has generated a vicious circle in a number of country economies and as a result of this, the phenomenon known as the fiscal trap has emerged. To begin with, the concept of the fiscal trap will be extensively explained in this article. At the same time, this study will tackle the theoretical framework regarding the concept of the fiscal trap and then this concept will be evaluated from the perspective of country practices.

• Details
• Contents