Fiscal Cycles in the Caribbean
July 1, 2009
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Summary
The sharp increase in debt in the Caribbean since the mid-1990s has focused attention on the conduct of fiscal policy in the region. This paper aims to diagnose how fiscal policy has behaved during this period by looking at three main cycles of the economy: the business, election, and natural disaster cycles. Our main findings suggest that fiscal policy has been mostly procyclical in the region, while disasters have been heavily "insured" by foreign transfers. The "when it rains, it pours" phenomena suggested by Kaminsky, Reinhart and Vegh (2004) seems to take place in the Caribbean.
Subject: Business cycles, Economic growth, Expenditure, Fiscal policy, Fiscal stance, Revenue administration
Keywords: Business cycles, capital revenue, Caribbean, ECCU country, ECCU economy, ECCU value, fiscal accounts, Fiscal stance, government, government consumption growth, natural disasters, Procyclicality, WP
Pages:
27
Volume:
2009
DOI:
Issue:
158
Series:
Working Paper No. 2009/158
Stock No:
WPIEA2009158
ISBN:
9781451873054
ISSN:
1018-5941
