Fiscal Rules in Response to the Crisis-Toward the 'Next-Generation' Rules: A New Dataset

By Andrea Schaechter, Tidiane Kinda, N. Budina, A. Weber. Social Science Research Network, 2012

442 citations recorded by the source corpus.

Strengthening fiscal frameworks, in particular fiscal rules, has emerged as a key response to the fiscal legacy of the crisis. This paper takes stock of fiscal rules in use around the world, compiles a dataset - covering national and supranational fiscal rules, in 81 countries from 1985 to end-March 2012 - and presents details about the rules’ key design elements, particularly in support of enforcement. This information is summarized in a set of fiscal rules indices. Three key findings emerge: (i) many new fiscal rules have been adopted and existing ones strengthened in response to the crisis; (ii) the number of fiscal rules and the comprehensiveness of the design features in emerging economies has caught up to those in advanced economies; and (iii) the "next-generation" fiscal rules are increasingly complex as they combine the objectives of sustainability and with the need for flexibility in response to shocks, thereby creating new challenges for implementation, communication, and monitoring.

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/b0f70fa815f470bede7325ffd71a3c9b074fb3fb

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Economics and Econometrics

Citations in the corpus

Promoting sustainable public finances in the European Union: The role of fiscal rules and government efficiency (2016, methodology): “These five new refined measures of the strength of fiscal rules, varying across countries and over time, are based on the specific characteristics of various types of fiscal constraints using the IMF FAD data base (Schaechter et al., 2012).”
Global Waves of Debt: Causes and Consequences (2021, background): “EMDEs have made important strides in the adoption and design of fiscal rules (Schaechter et al. 2012).”
The Political Economy of Government Debt (2015, unknown): “Finally, an external commitment, say an IMF conditionality agreement, may accelerate the resolution of the war of attrition making it more costly to “fight it.””
Flexible Fiscal Rules and Countercyclical Fiscal Policy (2016, unknown): “…have a stronger countercyclical effect than supranational ones, likely because the former are more binding on national fiscal authorities than the latter (Prakash and Cabezon, 2008; Tapsoba, 2012; Budina et al, 2012; and Dessus and others, 2013 for the West African Economic and Monetary Union).”