한국의 1980년대 긴축 재정정책 연구

Abstract

The purpose of this study is to analyze the effects of the 1980’s contractionary fiscal policies in Korea and to obtain some historical lessons and policy implications. In the 1980s, the increase rate of tax revenue was lower than that of nominal GDP, and the increase rate of government expenditure was much lower than that of tax revenue. In this way, the government reduced the consolidated budget deficit sharply, and this contributed the high-rising inflation rate to be cut down sharply. These types of fiscal policies at that time made the starting point of the overall tax-rate and the relative size of government expenditure(to GDP) low at the end point of contractions. We believe that the overall outcome could be improved if a higher overall tax-rate was accompanied by a relatively higher expenditure growth rate maintaining the same level of budget balance, as tax revenue is usually increased while government expenditure is decreased to conduct contractionary fiscal policies. Since the end of the 1980s, the relative size of government expenditure has been increased. However, the size in 2014 is smaller than that of 1981 by 2%p. The overall tax-rate in 2014 is higher than that of 1979 only by 1%p. To cope with several current critical issues such as low birth-rate, rapid aging, and increasing inequality, the role of fiscal policies in Korea should be strengthened and the overall tax-rate and the relative size of government expenditure be increased. As the 1980’s fiscal policies still have some impacts on the economy and policies up to now, it would take much time to overcome the harmful effects of the current tax and fiscal policies going backward since Lee Myung-bak administration.