Strengthening Post-Crisis Fiscal Credibility

Strengthening Post-Crisis Fiscal Credibility
Author: Mr.Xavier Debrun
Publisher: International Monetary Fund
Total Pages: 35
Release: 2014-04-08
Genre: Business & Economics
ISBN: 147552515X

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.

Strengthening the Credibility of Public Finances

Strengthening the Credibility of Public Finances
Author: International Monetary Fund
Publisher: International Monetary Fund
Total Pages: 114
Release: 2021-10-13
Genre: Business & Economics
ISBN: 1513584146

Chapter 1 argues that fiscal policy should remain nimble and strengthen its medium-term frameworks, as countries face highly uncertain and differentiated prospects. Vaccination has saved lives and is helping fuel a nascent recovery, but risks are elevated amidst new virus variants, high debt, and poverty. In advanced economies, the shift in fiscal support toward medium-term packages to “build back better” will have overall positive effects globally. Emerging markets and low-income developing countries face a more challenging outlook, with permanent economic scarring and revenue losses. They need international support to increase vaccine availability and financing to achieve the Sustainable Development Goals. Many countries find themselves in a situation where fiscal support is still invaluable to protect lives and livelihoods. At the same time, governments are also facing questions on their elevated debt and gross financing needs. Chapter 2 provides countries with guidance on how they can both avoid withdrawing fiscal support too early, and yet signal to the public that their debt levels are sustainable in the long run. To commit to future deficit reduction, governments have several instruments, including undertaking structural fiscal reforms (such as pension reform or subsidies reform), pre-legislating changes to taxes or spending, committing to fiscal rules that lead to deficit reduction in the future. Countries that follow debt rules, for instance, manage to reduce debt faster that other countries, although fiscal rules should also provide enough flexibility to spend in times of need. Overall, governments that commit to sound public finances and that achieve high levels of fiscal transparency reap meaningful benefits: their budgets are more credible, their announcements are better perceived by the media, and they pay lower interest rates on their debt.

Rethinking Fiscal Policy after the Crisis

Rethinking Fiscal Policy after the Crisis
Author: Ľudovít Ódor
Publisher: Cambridge University Press
Total Pages: 615
Release: 2017-05-18
Genre: Business & Economics
ISBN: 1108339484

This book discusses the often overlooked future of fiscal policy in light of what we have learned from the financial crisis. This book is for academics and graduate students studying the debate on fiscal policy, as well as practitioners working on day-to-day policy issues.

Independent Fiscal Councils: Recent Trends and Performance

Independent Fiscal Councils: Recent Trends and Performance
Author: Mr.Roel M. W. J. Beetsma
Publisher: International Monetary Fund
Total Pages: 28
Release: 2018-03-23
Genre: Business & Economics
ISBN: 1484348281

Countries increasingly rely on independent fiscal councils to constrain policymakers’ discretion and curb the bias towards excessive deficits and pro-cyclical policies. Since fiscal councils are often recent and heterogeneous across countries, assessing their impact is challenging. Using the latest (2016) vintage of the IMF Fiscal Council Dataset, we focus on two tasks expected to strengthen fiscal performance: the preparation or assessment of forecasts, and the monitoring of compliance with fiscal rules. Tentative econometric evidence suggests that the presence of a fiscal council is associated with more accurate and less optimistic fiscal forecasts, as well as greater compliance with fiscal rules.

Philippines

Philippines
Author: International Monetary Fund. Asia and Pacific Dept
Publisher: International Monetary Fund
Total Pages: 43
Release: 2017-11-10
Genre: Business & Economics
ISBN: 1484326865

This Selected Issues paper assesses potential spillover effects to the Philippines from US policy shifts and lower growth in China. The US fiscal expansion affects the Philippine economy through the interest rate and the trade channels. The net spillover impact on Philippine GDP is negative in the short term. Compared with the productive case, in which the net output impact is positive, the US nominal policy rate rises by less, but faster normalization of the US term premium leads to higher real interest rates. On the other hand, the gain from trade is smaller owing to the weaker domestic demand expansion in the United States.

OECD Economic Surveys: Euro Area 2016

OECD Economic Surveys: Euro Area 2016
Author: OECD
Publisher: OECD Publishing
Total Pages: 78
Release: 2016-06-10
Genre:
ISBN: 9264256369

This 2016 OECD Economic Survey of the Euro Area examines recent economic developments, policies and prospects. The special chapter cover: Making public finances more growth and equity-friendly.

Building a Better Union

Building a Better Union
Author: Angana Banerji
Publisher: International Monetary Fund
Total Pages: 41
Release: 2015-09-11
Genre: Business & Economics
ISBN: 1513537652

The momentum for structural reforms is waning in the euro area at a time when even faster progress is needed to boost productivity and growth, achieve real economic convergence, and improve the resilience of the monetary union. What can the European Union (EU) institutions do to bridge this divide? This paper argues for greater simplicity, transparency and accountability in the EU governance framework for structural reforms. Our three interrelated proposals—“outcome-based” benchmarking; better use of existing EU processes to strengthen oversight and reduce discretion; and improved financial incentives—could help advance reforms. Ex post monitoring by an independent EU-level “structural council” and ex ante policy innovation by national productivity councils could strengthen accountability and ownership. Deeper governance reforms should be considered in the medium-term with a view toward a greater EU role in promoting convergence.

Economic and Policy Foundations for Growth in South East Europe

Economic and Policy Foundations for Growth in South East Europe
Author: A. Bennett
Publisher: Springer
Total Pages: 221
Release: 2015-10-29
Genre: Political Science
ISBN: 1137488344

This volume argues that a renewed commitment to sound macroeconomic policies and structural reforms is needed for countries in South East Europe, or 'the Balkans' achieve to sustainable prosperity, along with enhanced support from the international community. New fiscal and financial architecture has valuable lessons for policymakers in SEE.

Fiscal Politics

Fiscal Politics
Author: Vitor Gaspar
Publisher: International Monetary Fund
Total Pages: 548
Release: 2017-04-07
Genre: Business & Economics
ISBN: 1475547900

Two main themes of the book are that (1) politics can distort optimal fiscal policy through elections and through political fragmentation, and (2) rules and institutions can attenuate the negative effects of this dynamic. The book has three parts: part 1 (9 chapters) outlines the problems; part 2 (6 chapters) outlines how institutions and fiscal rules can offer solutions; and part 3 (4 chapters) discusses how multilevel governance frameworks can help.

Comparing Fiscal Federalism

Comparing Fiscal Federalism
Author: Alice Valdesalici
Publisher: BRILL
Total Pages: 409
Release: 2018-02-27
Genre: Law
ISBN: 9004340955

Comparing Fiscal Federalism investigates intergovernmental financial relations and the current de jure and de facto allocation of financial and fiscal powers in compound states from a comparative and interdisciplinary perspective. The volume combines theoretical approaches with case studies and involves scholars from various disciplines, in order to provide a comprehensive analysis of different approaches, developments and trends. This includes outlining fiscal federalism’s basic principles and overall frameworks, investigating current constitutional/legislative settings and how financial systems function, as well as zooming in on a selection of emerging issues in financial and fiscal relations. The single chapters are based on comparative investigations under the umbrella of a broad definition of fiscal federalism that includes all varieties of federal systems.