Second-Generation Fiscal Rules : Balancing Simplicity, Flexibility, and Enforceability

Author/Editor:

Luc Eyraud ; Xavier Debrun ; Andrew Hodge ; Victor Duarte Lledo ; Catherine A Pattillo

Publication Date:

April 13, 2018

Electronic Access:

Free Download. Use the free Adobe Acrobat Reader to view this PDF file

Disclaimer: This Staff Discussion Note represents the views of the authors and does not necessarily represent IMF views or IMF policy. The views expressed herein should be attributed to the authors and not to the IMF, its Executive Board, or its management. Staff Discussion Notes are published to elicit comments and to further debate.

Summary:

Fiscal rule frameworks have evolved significantly in response to the global financial crisis. Many countries have reformed their fiscal rules or introduced new ones with a view to enhancing the credibility of fiscal policy and providing a medium-term anchor. Enforcement and monitoring mechanisms have also been upgraded. However, these innovations have made the systems of rules more complicated to operate, while compliance has not improved. The SDN takes stock of past experiences, reviews recent reforms, and presents new research on the effectiveness of rules. It also proposes guiding principles for future reforms to strike a better balance between simplicity, flexibility, and enforceability. Read the blog

Series:

Staff Discussion Notes No. 18/04

Subject:

Notes:

See Also: Background Paper

English

Publication Date:

April 13, 2018

ISBN/ISSN:

9781484350683/2221-030X

Stock No:

SDNEA2018004

Format:

Paper

Pages:

132

Please address any questions about this title to publications@imf.org