On Improving Public Expenditure Policies for the Poor: Major Informational Requirements

IMF Working Papers, May 1, 1993

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On Improving Public Expenditure Policies for the Poor: Major Informational Requirements

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Bibliographic details

• Authors: Nigel A Chalk, Ehtisham Ahmad
• Published: May 1, 1993
• Series: IMF Working Papers
• DOI: https://doi.org/10.5089/9781451846270.001

Executive summary and purpose

• An improvement in the quality of public expenditures is needed in many countries, given binding macroeconomic and fiscal constraints, and poverty reduction and distributional objectives.
• The paper reassesses methodology used by countries and international agencies, and the data needed for improved decision making.
• The paper reviews methods that might be used by international agencies, such as the Fund and the Bank, jointly with:
  • a survey of data currently available,
  • required improvements in the data currently available,
  • required improvements in the information base.
• The scope for improvements in governments' expenditure policy making is also considered.

Major findings (methodology and data)

• Current methodologies for assessing public expenditure policies often require reassessment to better align with poverty reduction and distributional objectives.
• Available data limitations constrain effective public expenditure policy formulation.
• Improvement areas highlighted include:
  • expenditure data quality and granularity,
  • integration of government accounting systems with public expenditure analysis,
  • better linkage between national accounts, government finance statistics, and microdata on income and consumption patterns.

Policy implications and recommendations

• Strengthen the information base to support more effective public expenditure decisions targeted at the poor.
• Improve government accounting systems and payroll data to better capture expenditure profiles and public spending on pay and national defense.
• Enhance country desk and country-level analytical capacity to interpret aggregate expenditure ratios and expenditure profiles for policy design.
• Foster joint methodological approaches between international agencies (the Fund and the Bank) to harmonize assessments and data requirements.

Scope and thematic coverage

• Subject areas covered: Defense spending, Economic and financial statistics, Education, Expenditure, Government finance statistics, Income, National accounts.
• Keywords and concepts emphasized: aggregate expenditure ratio, consumption pattern, expenditure data, expenditure profile, expenditure scale, government accounting system, Government finance statistics, national defense, pay, payroll data, public expenditure, public goods, standard of living, Sub-Saharan Africa.