Fiscal councils : rationale and effectiveness /

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Bibliographic Details
Author / Creator:	Beetsma, Roel M. W. J., author.
Imprint:	[Washington, D.C.] : International Monetary Fund, [2016]. ©2016
Description:	1 online resource (26 pages) : color illustrations.
Language:	English
Series:	IMF working paper ; WP/16/86 IMF working paper ; WP/16/86.
Subject:	Fiscal policy -- Econometric models. Debts, Public -- Econometric models. Budget deficits -- Econometric models. Budget deficits -- Econometric models. Debts, Public -- Econometric models. Fiscal policy -- Econometric models.
Format:	E-Resource Book
URL for this record:	http://pi.lib.uchicago.edu/1001/cat/bib/12505033

Hidden Bibliographic Details
Other authors / contributors:	Debrun, Xavier. (IMFstaff), author. International Monetary Fund. Fiscal Affairs Department, issuing body.
ISBN:	1484322908 9781484322901 1484330145 9781484330142
ISSN:	1018-5941
Notes:	"April 2016." At head of title: "Fiscal Affairs Department." Includes bibliographical references (pages 24-25). Description based on online resource; title from pdf title page (IMF.org Web site, viewed April 11, 2016).
Summary:	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.
Other form:	1-4843-2290-8
Standard no.:	10.5089/9781484322901.001

Table of Contents:

Cover; Content; I. Introduction; II. Fiscal Councils on the Rise; A. Deficit Bias and the Emergence of Fiscal Councils; B. Institutions for Fiscal Credibility?; III. A Simple Model of a Fiscal Council; A. Basic Setup; B. Establishing an FC is Society's Choice; C. Installing an FC Is the Prerogative of the Government; IV. Are Existing Fiscal Councils Built to Work?; A. Enhancing the Signal: An Index; B. Results; V. Conclusion; References; Figures; 1. Advanced Economies: Frequency of Overall Fiscal Deficits Above 0.5 percent of GDP
2. G7 and Selected Emerging Market Economies: Public Debt (1880-2020)3. Number of Countries with Fiscal Rules and Fiscal Councils; 4. Assessing Fiscal Councils' Signal-Enhancement Capacity: An Index; 5. Independence and Signal-Enhancing Functions

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