When is Fiscal Adjustment an Illusion? PDF Download
Are you looking for read ebook online? Search for your book and save it on your Kindle device, PC, phones or tablets. Download When is Fiscal Adjustment an Illusion? PDF full book. Access full book title When is Fiscal Adjustment an Illusion? by William Russell Easterly. Download full books in PDF and EPUB format.
Author: William Russell Easterly
Publisher: World Bank Publications
ISBN:
Category : Assets (Accounting)
Languages : en
Pages : 36
Get Book
Book Description
Author: William Russell Easterly
Publisher: World Bank Publications
ISBN:
Category : Assets (Accounting)
Languages : en
Pages : 36
Get Book
Book Description
Author: William Easterly
Publisher:
ISBN:
Category :
Languages : en
Pages : 32
Get Book
Book Description
A simple model shows that when an outside agent forces a reduction in a government's conventional deficit (debt accumulation), the government will respond by lowering its asset accumulation or by increasing hidden liabilities. That leaves net worth unchanged, so fiscal adjustment is an illusion.Fiscal adjustment is an illusion when it lowers the budget deficit or public debt but leaves the government's net worth unchanged, says Easterly.Conventional measures of the budget deficit largely measure the change in explicit public sector liabilities (debt). A more appropriate measure of the deficit would be the change in public sector net worth, but many criticize this concept as impossible to measure.Easterly takes a positive, rather than normative, approach to the net worth definition of fiscal balance.A simple model shows that when an outside agent forces a reduction in a government's conventional deficit (debt accumulation), the government will respond by lowering its asset accumulation or by increasing hidden liabilities. That leaves net worth unchanged, so fiscal adjustment is an illusion.He performs some simple empirical tests on the observational predictions of the model, examining a sample of countries with World Bank and International Monetary Fund adjustment programs and case studies of Maastricht Euro countries.The results confirm the model predictions: Fiscal adjustment in these countries was at least partly an illusion.This paper - a product of Macroeconomics and Growth, Development Research Group - is part of a larger effort in the group to study the political economy of policymaking. The author may be contacted at
[email protected].
Author: Timothy Irwin
Publisher: International Monetary Fund
ISBN: 1475571321
Category : Business & Economics
Languages : en
Pages : 24
Get Book
Book Description
This proposed SDN surveys the various accounting stratagems which governments have used to meet fiscal targets—thereby sidestepping the need for true adjustment—and suggests remedial actions to limit this type of fiscal non-transparency. Types of creative accounting covered includes, for instance, currency swaps to hide a debt build-up (as in Greece in 2001–07), sale and leaseback of government property (for example, in the United States), assumption of long-term pension obligations in exchange for short-term revenue (Argentina, Hungary, and other Eastern European countries), use of public-private partnerships to defer the recognition of investment spending (for instance, Portugal), and reliance on non-cash compensation (such as pension rights) to reduce measured wage bills (in the United States, United Kingdom, etc.) As is evident from the examples given, these fiscal tricks have recently come under increased international scrutiny, highlighting the importance of good fiscal reporting, accounting, and transparency in general, for avoiding unpleasant surprises, ensuring government accountability, and containing fiscal vulnerabilities.
Author:
Publisher: World Bank Publications
ISBN:
Category :
Languages : en
Pages : 56
Get Book
Book Description
Author: Mr.Kenji Moriyama
Publisher: International Monetary Fund
ISBN: 1451856377
Category : Business & Economics
Languages : en
Pages : 27
Get Book
Book Description
Several European Union countries have recently implemented or are envisaging fiscal that operations improve budgetary figures but have no structural impact on government finances. This paper evaluates some of these measures using a balance sheet approach. In particular, it examines the degree to which reductions in government debt in EU countries has been accompanied by a decumulation of government assets. In the run-up to Maastricht (1997) it finds a strong correlation between changes in government liabilities and government assets, and larger declines in government assets in countries starting from higher public debt levels.
Author: Lev M. Freinkman
Publisher: World Bank Publications
ISBN: 9780821356043
Category : Budget deficits
Languages : en
Pages : 62
Get Book
Book Description
Author: Hana Polackova Brixi
Publisher: World Bank Publications
ISBN:
Category : Budget deficits
Languages : en
Pages : 48
Get Book
Book Description
Governments' contingent liabilities increase fiscal vulnerability, but are omitted in traditional measures of the current deficit. In the Czech Republic this omission may mean that fiscal adjustment has been overstated by 3 to 4 percent of annual GDP, with future budgets having to pay for past guarantees. The stock of existing contingent liabilities in Macedonia could add 2 to 4 percent of GDP to that country's future deficits.
Author: Mr.Timothy Irwin
Publisher: International Monetary Fund
ISBN: 1475552823
Category : Business & Economics
Languages : en
Pages : 17
Get Book
Book Description
When rights and obligations are not recognized as assets and liabilities on a government’s balance sheet, the government’s deficit can be reduced by selling off-balance-sheet assets or incurring off-balance-sheet liabilities. This paper examines how much progress has been made in recognizing assets and liabilities and thus dispelling the fiscal illusions that such transactions create. Looking at the accounts, government-finance statistics, and long-term fiscal projections produced in 28 advanced economies in the period since 2003, it finds good progress in the recognition of some assets and liabilities, such as accounts payable and simple financial assets, but much less in others, such as civil-service pensions.
Author: Scott Sumner
Publisher: University of Chicago Press
ISBN: 0226826562
Category : Business & Economics
Languages : en
Pages : 415
Get Book
Book Description
The first book-length work on market monetarism, written by its leading scholar. Is it possible that the consensus around what caused the 2008 Great Recession is almost entirely wrong? It’s happened before. Just as Milton Friedman and Anna Schwartz led the economics community in the 1960s to reevaluate its view of what caused the Great Depression, the same may be happening now to our understanding of the first economic crisis of the 21st century. Foregoing the usual relitigating of problems such as housing markets and banking crises, renowned monetary economist Scott Sumner argues that the Great Recession came down to one thing: nominal GDP, the sum of all nominal spending in the economy, which the Federal Reserve erred in allowing to plummet. The Money Illusion is an end-to-end case for this school of thought, known as market monetarism, written by its leading voice in economics. Based almost entirely on standard macroeconomic concepts, this highly accessible text lays the groundwork for a simple yet fundamentally radical understanding of how monetary policy can work best: providing a stable environment for a market economy to flourish.
Author: International Monetary Fund. Independent Evaluation Office
Publisher: International Monetary Fund
ISBN: 1589062744
Category : Business & Economics
Languages : en
Pages : 128
Get Book
Book Description
Using a cross-country sample of 169 IMF-supported programs and detailed studies of 15 programs, this evaluation report examines various aspects of fiscal adjustment in IMF-supported programs. It presents evidence that does not support some critics’ view that IMF-supported programs typically adopt a one-size-fits-all approach to fiscal adjustment, nor the perception that programs always involve austerity by targeting reductions in public spending. The report also proposes a number of recommendations for IMF surveillance and program design in the future.
