Do Fiscal Rules Constrain Political Budget Cycles? - read free eBook in online reader or directly download on the web page. Select files or add your book in reader. Download and read online ebook Do Fiscal Rules Constrain Political Budget Cycles? write by Bra Gootjes. This book was released on 2019. Do Fiscal Rules Constrain Political Budget Cycles? available in PDF, EPUB and Kindle.
Making Rules Credible
Making Rules Credible - read free eBook in online reader or directly download on the web page. Select files or add your book in reader. Download and read online ebook Making Rules Credible write by Jorge M. Streb. This book was released on 2011. Making Rules Credible available in PDF, EPUB and Kindle. Political budget cycles (PBCs) result from the credibility problems that office-motivated incumbents face under asymmetric information, due to their temptation to manipulate fiscal policy to increase their electoral chances. We analyze the role of rules that limit debt, crucial for aggregate PBCs to take place. Since the budget process under separation of powers typically requires that the legislature authorize new debt, divided government can make these fiscal rules credible. Commitment is undermined either by unified government or by imperfect compliance with the budget law. When divided government affects efficiency, voters must trade off electoral distortions and government competence.
Fiscal Rules and Fiscal Performance in Europe and Japan
Fiscal Rules and Fiscal Performance in Europe and Japan - read free eBook in online reader or directly download on the web page. Select files or add your book in reader. Download and read online ebook Fiscal Rules and Fiscal Performance in Europe and Japan write by Jürgen von Hagen. This book was released on 2006. Fiscal Rules and Fiscal Performance in Europe and Japan available in PDF, EPUB and Kindle. Fiscal rules specify quantitative targets for key budgetary aggregates. In this paper, we review the experience with such rules in Japan and in the EU. Comparing the performance of fiscal policy in the 1980s and 1990s until 2003, we find that the fiscal rule of the 1980s exerted some but not much disciplinary influence on Japanese fiscal policy. The fiscal rule of the Maastricht Treaty had a significant impact on political budget cycles in the EU, but did little to constrain fiscal policy in the large member states. Since the start of the European Monetary Union, the disciplinary effect of the fiscal rule in the EU has vanished. Next, we discuss the importance of budgetary institutions for the effectiveness of fiscal rules. In Europe, a number of countries adopted strong fiscal rules, i.e., a fiscal rule combined with a design of the budget process enabling governments to commit to the rule. We find that strong fiscal rules have been effective. We conclude with some suggestions for the design of a strong fiscal rule in Japan.
Do Fiscal Rules Cause Better Fiscal Balances? A New Instrumental Variable Strategy
Do Fiscal Rules Cause Better Fiscal Balances? A New Instrumental Variable Strategy - read free eBook in online reader or directly download on the web page. Select files or add your book in reader. Download and read online ebook Do Fiscal Rules Cause Better Fiscal Balances? A New Instrumental Variable Strategy write by Francesca G Caselli. This book was released on 2019-03-05. Do Fiscal Rules Cause Better Fiscal Balances? A New Instrumental Variable Strategy available in PDF, EPUB and Kindle. This paper estimates the causal effect of fiscal rules on fiscal balances in a panel of 142 countries over the period 1985-2015. Our instrumental variable strategy exploits the geographical diffusion of fiscal rules across countries. The intuition is that reforms in neighboring countries may affect the adoption of domestic reforms through peer pressure and imitational effects. We find that fiscal rules correlate with lower deficits, but the positive link disappears when endogeneity is correctly addressed. However, when considering an index of fiscal rules’ design, we show that well-designed rules have a statistically significant impact on fiscal balances. We conduct several robustness tests and show that our results are not affected by weak instrument problems.
Political Budget Cycles in New Versus Established Democracies
Political Budget Cycles in New Versus Established Democracies - read free eBook in online reader or directly download on the web page. Select files or add your book in reader. Download and read online ebook Political Budget Cycles in New Versus Established Democracies write by Adi Brender. This book was released on 2004. Political Budget Cycles in New Versus Established Democracies available in PDF, EPUB and Kindle. "Like other recent studies, we find the existence of a political deficit cycle in a large cross-section of countries. However, we find that this result is driven by the experience of new democracies'. The strong budget cycle in those countries accounts for the finding of a budget cycle in larger samples that include these countries; when these countries are removed from the larger sample, so that only established' democracies remain, the political budget cycle disappears. The political deficit cycle in new democracies accounts for findings in both developed and less developed economies, for the finding that the cycle is stronger in weaker democracies, and for differences in the political cycle across governmental and electoral systems. Our findings may reconcile two contradictory views of pre-electoral manipulation, one arguing it is a useful instrument to gain voter support and a widespread empirical phenomenon, the other arguing that voters punish rather than reward fiscal manipulation"--NBER website
