Independent Fiscal Councils: Recent Trends and Performance
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Summary:
Countries increasingly rely on independent fiscal councils to constrain policymakers’ discretion and curb the bias towards excessive deficits and pro-cyclical policies. Since fiscal councils are often recent and heterogeneous across countries, assessing their impact is challenging. Using the latest (2016) vintage of the IMF Fiscal Council Dataset, we focus on two tasks expected to strengthen fiscal performance: the preparation or assessment of forecasts, and the monitoring of compliance with fiscal rules. Tentative econometric evidence suggests that the presence of a fiscal council is associated with more accurate and less optimistic fiscal forecasts, as well as greater compliance with fiscal rules.
Series:
Working Paper No. 2018/068
Subject:
Budget planning and preparation Fiscal councils Fiscal policy Fiscal rules Fiscal stance Public financial management (PFM)
English
Publication Date:
March 23, 2018
ISBN/ISSN:
9781484348284/1018-5941
Stock No:
WPIEA2018068
Pages:
28
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