The Discipline Enhancing Role Of Fiscal Institutions

Author : Xavier Debrun,Manmohan S. Kumar
Publisher : International Monetary Fund
Page : 54 pages
File Size : 43,7 Mb
Release : 2007-07
Category : Business & Economics
ISBN : UCSD:31822034966184

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The Discipline-Enhancing Role of Fiscal Institutions by Xavier Debrun,Manmohan S. Kumar Pdf

This paper discusses the role of fiscal institutions, including budget rules and non-partisan agencies, in enhancing fiscal discipline. A dynamic model of fiscal policy shows that optimal institutions lack credibility unless the costs to bypass them are sufficiently high. In our model, a combination of complete budgetary transparency and strong democratic accountability suffice to establish credibility. Under incomplete budgetary transparency, accountable governments may also use institutions as a signal of competence to increase their reelection chances, which in turn erodes the penchant for excessive deficits. In light of the theory, empirical tests of the effectiveness of institutions are undertaken. The results further emphasize that analysis should pay due attention to simultaneity bias (because disciplined governments may be more likely to adopt strict institutions). Also, interactions among different fiscal institutions, and between the latter and key features of the political system need to be explored further.

Author : Mr.Manmohan S. Kumar,Mrs.Teresa Ter-Minassian
Publisher : International Monetary Fund
Page : 144 pages
File Size : 45,9 Mb
Release : 2007-10-18
Category : Business & Economics
ISBN : 9781589066090

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Promoting Fiscal Discipline by Mr.Manmohan S. Kumar,Mrs.Teresa Ter-Minassian Pdf

Fiscal discipline is essential to improve and sustain economic performance, maintain macroeconomic stability, and reduce vulnerabilities. Discipline is especially important if countries, industrial as well as developing, are to successfully meet the challenges, and reap the benefits, of economic and financial globalization. Lack of fiscal discipline generally stems from the injudicious use of policy discretion. The benefits of discretion are seen in terms of the ability of policymakers to respond to unexpected shocks and in allowing elected political representatives to fulfill their mandates. But discretion can be misused, resulting in persistent deficits and procyclical policies, rising debt levels, and, over time, a loss in policy credibility. The authors first explore the role of discretion in fiscal policy, and the extent, consequences, and causes of procyclicality, particularly in good times. They then examine how a variety of institutional approaches—fiscal rules, fiscal responsibility laws, and fiscal agencies—can help improve fiscal discipline. While each of these approaches can play a useful role, the authors suggest that a strategy combining them is likely to be particularly beneficial. Although such a strategy requires political commitment and effective fiscal management, at the same time, the strategy itself can bolster political commitment by highlighting the restraints on government and raising the costs of failing to respect them.

Author : Mr.Roel M. W. J. Beetsma,Mr.Xavier Debrun
Publisher : International Monetary Fund
Page : 26 pages
File Size : 43,8 Mb
Release : 2016-04-12
Category : Business & Economics
ISBN : 9781475520064

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Fiscal Councils by Mr.Roel M. W. J. Beetsma,Mr.Xavier Debrun Pdf

The paper discusses the effectiveness of independent fiscal institutions—or fiscal councils—in taming the deficit bias that emerged in the 1970s. After a review of the main theoretical arguments and recent trends about fiscal councils, we develop a stylized model showing how a fiscal council can effectively mitigate the deficit bias even though it has no direct lever on the conduct of fiscal policy. We show that the capacity of the fiscal council to improve the public’s understanding of the quality of fiscal policy contributes to better align voters and policymakers’ incentives and to tame the deficit bias affecting well-intended governments. After mapping the model’s key features into a broad set of criteria likely to contribute to the effectiveness of a fiscal council, we use the 2014 vintage of the IMF dataset on independent fiscal institutions to assess whether existing institutions have been built to work.

Author : Ananya Kotia,Victor Duarte Lledo
Publisher : International Monetary Fund
Page : 37 pages
File Size : 54,9 Mb
Release : 2016-04-07
Category : Business & Economics
ISBN : 9781484322031

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Do Subnational Fiscal Rules Foster Fiscal Discipline? New Empirical Evidence from Europe by Ananya Kotia,Victor Duarte Lledo Pdf

This paper studies how fiscal rules interact with the intergovernmental fiscal framework to foster fiscal discipline among European subnational governments. We use political variables describing the fiscal attitudes of the central government as instruments to obtain consistent estimates of the impact of subnational fiscal rules on fiscal balances. The results suggest that the discipline-enhancing effect of fiscal rules is weaker when there are large “vertical fiscal imbalances” that is, large differences in revenue and spending assignments across the different levels of government. These findings imply that separate reforms to reduce excessive vertical fiscal imbalances complement a rules-based fiscal framework that is aimed at fostering fiscal discipline.

Author : International Monetary Fund. Fiscal Affairs Dept.
Publisher : International Monetary Fund
Page : 73 pages
File Size : 48,6 Mb
Release : 2009-12-11
Category : Business & Economics
ISBN : 9781498335164

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Fiscal Rules—Anchoring Expectations for Sustainable Public Finances by International Monetary Fund. Fiscal Affairs Dept. Pdf

The sharp increase in fiscal deficits and public debt in most advanced and several developing economies has raised concerns about the sustainability of public finances and highlighted the need for a significant adjustment over the medium term. This paper assesses the usefulness of fiscal rules in supporting fiscal consolidation, discusses the design and implementation of rules based on a new data base spanning the whole Fund membership, and explores the fiscal framework that could be adopted as countries emerge from the crisis.

Author : J. Ayuso-i-Casals,S. Deroose,E. Flores,Laurent Moulin
Publisher : Springer
Page : 356 pages
File Size : 55,8 Mb
Release : 2009-08-14
Category : Business & Economics
ISBN : 9780230271791

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Policy Instruments for Sound Fiscal Policies by J. Ayuso-i-Casals,S. Deroose,E. Flores,Laurent Moulin Pdf

This volume contributes to empirical research on the role of national fiscal rules and institutions in shaping fiscal policies. It provides original, policy-oriented analysis on a number of questions and gives illuminating conclusions about the devices which promote sound and sustainable policy. Contributors are leading experts.

Author : Mr.J. D. Craig,Mr.George Kopits
Publisher : International Monetary Fund
Page : 50 pages
File Size : 49,9 Mb
Release : 1998-02-03
Category : Business & Economics
ISBN : 9781557756978

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Transparency in Government Operations by Mr.J. D. Craig,Mr.George Kopits Pdf

Transparency in government operations is widely regarded as an important precondition for macroeconomic fiscal sustainability, good governance, and overall fiscal rectitude. Notably, the Interim Committee, at its April and September 1996 meetings, stressed the need for greater fiscal transparency. Prompted by these concerns, this paper represents a first attempt to address many of the aspects of transparency in government operations. It provides an overview of major issues in fiscal transparency and examines the IMF's role in promoting transparency in government operations.

Author : Mr. M. Cangiano,Ms. Teresa R Curristine,Mr. Michel Lazare
Publisher : International Monetary Fund
Page : 468 pages
File Size : 43,5 Mb
Release : 2013-04-05
Category : Business & Economics
ISBN : 9781475512199

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Public Financial Management and Its Emerging Architecture by Mr. M. Cangiano,Ms. Teresa R Curristine,Mr. Michel Lazare Pdf

The first two decades of the twenty-first century have witnessed an influx of innovations and reforms in public financial management. The current wave of reforms is markedly different from those in the past, owing to the sheer number of innovations, their widespread adoption, and the sense that they add up to a fundamental change in the way governments manage public money. This book takes stock of the most important innovations that have emerged over the past two decades, including fiscal responsibility legislation, fiscal rules, medium-term budget frameworks, fiscal councils, fiscal risk management techniques, performance budgeting, and accrual reporting and accounting. Not merely a handbook or manual describing practices in the field, the volume instead poses critical questions about innovations; the issues and challenges that have appeared along the way, including those associated with the global economic crisis; and how the ground can be prepared for the next generation of public financial management reforms. Watch Video of Book Launch

Author : Joaquim Ayuso-i-Casals
Publisher : Unknown
Page : 396 pages
File Size : 41,9 Mb
Release : 2007
Category : European Economic Community countries
ISBN : IND:30000122955606

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The Role of Fiscal Rules and Institutions in Shaping Budgetary Outcomes by Joaquim Ayuso-i-Casals Pdf

Author : International Monetary Fund
Publisher : International Monetary Fund
Page : 257 pages
File Size : 50,6 Mb
Release : 2015-04-20
Category : Business & Economics
ISBN : 9781498344654

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Fiscal Policy and Long-Term Growth by International Monetary Fund Pdf

This paper explores how fiscal policy can affect medium- to long-term growth. It identifies the main channels through which fiscal policy can influence growth and distills practical lessons for policymakers. The particular mix of policy measures, however, will depend on country-specific conditions, capacities, and preferences. The paper draws on the Fund’s extensive technical assistance on fiscal reforms as well as several analytical studies, including a novel approach for country studies, a statistical analysis of growth accelerations following fiscal reforms, and simulations of an endogenous growth model.

Author : Mr.Bernardin Akitoby,Mr.Larry Q Cui,Silvia Domit,Jingzhou Meng,Mr.Slavi T Slavov,Mrs.Nujin Suphaphiphat,Hanqi Zhang
Publisher : International Monetary Fund
Page : 66 pages
File Size : 51,9 Mb
Release : 2020-05-11
Category : Business & Economics
ISBN : 9781513532837

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Improving Fiscal Transparency to Raise Government Efficiency and Reduce Corruption Vulnerabilities in Central, Eastern, and Southeastern Europe by Mr.Bernardin Akitoby,Mr.Larry Q Cui,Silvia Domit,Jingzhou Meng,Mr.Slavi T Slavov,Mrs.Nujin Suphaphiphat,Hanqi Zhang Pdf

This departmental paper investigates how countries in Central, Eastern, and Southeastern Europe (CESEE) can improve fiscal transparency, thereby raising government efficiency and reducing corruption vulnerabilities.

Author : International Monetary Fund. Middle East and Central Asia Dept.
Publisher : International Monetary Fund
Page : 64 pages
File Size : 42,6 Mb
Release : 2018-08-24
Category : Business & Economics
ISBN : 9781484374382

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Saudi Arabia by International Monetary Fund. Middle East and Central Asia Dept. Pdf

This Selected Issues paper suggests that while the government should continue to work on clearly defining its fiscal policy objectives, at this stage the focus of reforms should be to continue to strengthen the fiscal framework rather than on introducing a formal fiscal rule. A fiscal rule is only as good as the institutions that support it. Moreover, resource rich countries’ experiences with fiscal rules have been mixed as it has proven difficult to formulate rules which are simple, flexible, and robust that can withstand large commodity prices swings. One key question before the government is to define its long-term fiscal policy objectives beyond 2023. This will help determine how it may want to anchor fiscal policy. While a target for the overall balance, as announced in the Fiscal Balance Program, is a reasonable objective for the next 5 years, such a target may not deliver the longer-term fiscal goals of the government. It is also subject to swings in oil prices—it may not be achievable if oil prices decline significantly, but if oil prices were to increase substantially, the target could be achieved even if spending were to increase to such a level that increases future fiscal vulnerabilities. Therefore, it would be better to formulate fiscal policy objectives in terms of the primary non-oil balance rather than the overall balance.

Author : René Geissler,Gerhard Hammerschmid,Christian Raffer
Publisher : Springer Nature
Page : 354 pages
File Size : 42,6 Mb
Release : 2021-04-20
Category : Law
ISBN : 9783030674663

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Local Public Finance by René Geissler,Gerhard Hammerschmid,Christian Raffer Pdf

This book is based upon a comparative public administration research project, initiated by the Hertie School of Governance (Germany) and the Bertelsmann Foundation (Germany) and supported by a network of researchers from many EU countries. It analyzes both the regimes and the practices of local fiscal regulation in 21 European countries. The book brings together key findings of this research project. The regulatory discussion is not limited to the prominent issue of fiscal rules but focuses on every component of regulation. Beyond this, the book covers affiliated topics such as the impact of regulation for local governments, evolution of regulation, administrative costs and crisis prevention. The various book chapters throughout provide a broad picture of local public finance regulation in theory and in practice, using different theoretical and national lenses for the analysis. Furthermore, the authors investigate the effects of budgetary constraints and higher-level regulatory efforts on local governments and on democracy and public services in every European country. This book fills a gap with respect to the lack of discussion on local government finance from an international, comparative perspective and, in particular, the regulation of local public finance. With its mix of authors, this book will be useful for practitioners as well as for scholars and for theory-driven research.

Author : Mr.Xavier Debrun,Mr.Tidiane Kinda
Publisher : International Monetary Fund
Page : 35 pages
File Size : 55,5 Mb
Release : 2014-04-08
Category : Business & Economics
ISBN : 9781475525151

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Strengthening Post-Crisis Fiscal Credibility by Mr.Xavier Debrun,Mr.Tidiane Kinda Pdf

Institutions aimed at constraining policy discretion to promote sound fiscal policies are once again at the forefront of the policy debate. Interest in “fiscal councils,” independent watchdogs active in the public debate, has grown rapidly in recent years. This paper presents the first cross-country dataset summarizing key characteristics of fiscal councils among IMF members. The data documents a surge in the number of fiscal councils since the crisis. It also illustrates that well-designed fiscal councils are associated with stronger fiscal performance and better macroeconomic and budgetary forecasts. Key features of effective fiscal councils include operational independence from politics, the provision or public assessment of budgetary forecasts, a strong presence in the public debate, and the monitoring of compliance with fiscal policy rules.

Author : Marcos Poplawski Ribeiro
Publisher : Rozenberg Publishers
Page : 316 pages
File Size : 53,7 Mb
Release : 2008
Category : Electronic
ISBN : 9789051709803

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Fiscal policy under rules and restrictions by Marcos Poplawski Ribeiro Pdf