The housing net worth channel and the public finances: evidence from a European country panel

In the growing literature on importance of household balance sheets to macroeconomic developments, relationship between housing wealth and fiscal outturns needs consideration given likely links market developments particular tax headings. We adopt net worth model for this purpose. Using a panel dataset 18 European countries over period 1998 2017, we find changes in having significant impact primary budget balance, with increases (decreases) causing improve (dis-improve). Further support channel public finances arises by differentiating observations based amount revenue raised under