Occasional Studies

Publications from NIER in the Occasional studies series.

  • | Occasional Study

    Fiscal Sustainability Report 2022


     Although the pandemic has placed a substantial burden on public finances in the short term, the NIER considers Sweden’s public finances to be long-term sustainable. Current tax rules are sufficient to fund a growing need for welfare services as the population ages. We believe there is scope to cut taxes or increase expenditure and still meet the surplus target. Even if this is replaced with a balanced-budget target at the next review, Maastricht debt does not exceed the debt anchor. Our analysis is based on a number of assumptions, including that the population’s health improves as life expectancy increases, and so more people choose to work to a later age. Public finances are also considered sustainable in the alternative scenarios presented. Our analysis does show, however, that the assumption of improved health is crucial to sustainability in the longer term. Compared with previous years’ calculations, a more favourable demographic outlook and a better starting position contribute to stronger public finances than in this year’s report.
  • | Occasional Study

    Fiscal multipliers in Sweden


     Fiscal multipliers for eight different fiscal instruments are calculated using the National Institute of Economic Research's DSGE model SELMA, a model which is parameterized to match the behavior of the Swedish economy. The fiscal multipliers are largely in line with the literature on fiscal multipliers. The government consumption multiplier is close to, but higher
    than 1, which is in line with consensus in the empirical literature. Furthermore, it is shown that the conducted monetary policy during and after the fiscal stimulus matter significantly for the resulting multiplier. The use of an empirically reasonable monetary policy rule does however not change the consumption multiplier from the consensus view. In addition, it is shown that using monetary policy accommodation yields a stronger increase in the fiscal multipliers than if the monetary policy rate is at its lower bound.
  • | Occasional Study

    Fiscal Sustainability Report 2021


     The Covid-19 pandemic has come at considerable cost to Sweden, including for public finances. In the report’s base scenario, both the government’s net financial position and Maastricht debt as a share of GDP are nevertheless around the same in 2050 as they were before the pandemic. Public finances are therefore considered to be long-term sustainable. Much of the recovery in public finances will, however, take place in the near term as the economy rebounds. The base scenario assumes that the population grows healthier and works to a greater age. In an alternative scenario where this does not happen, public finances are not found to be long-term sustainable.
  • | Occasional Study

    Fiscal Sustainability Report 2019


     An ageing population will put pressure on public finances in the coming decades. The NIER’s Fiscal Sustainability Report 2019 shows that Sweden’s current strong public finances provide much-needed space to meet demographic challenges, but the margins are small.