{
  "title": "Political Budget Cycles in Papua New Guinea",
  "publication": "IMF Working Papers, September 1, 2007",
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  "summary": "This paper assesses the presence of opportunistic electoral budget cycles in Papua New Guinea. Using quarterly time series data, a clear pattern emerges of pre-election manipulations of fiscal policy by incumbent governments, mainly in the form of increased development spending and overall primary e",
  "sections": [
    {
      "heading": "Overview",
      "content": "- This paper assesses the presence of opportunistic electoral budget cycles in Papua New Guinea.\n- Using quarterly time series data, the paper identifies a clear pattern of pre-election manipulations of fiscal policy by incumbent governments, mainly in the form of increased development spending and overall primary expenditure, followed in some cases by retrenchment in post-election periods.\n- The findings are described as consistent with the predictions of rational opportunistic political business cycle theory.\n- Revenue was not statistically significantly related to elections, either in the pre- or post-election period, implying electoral swings in fiscal deficits reflect a preference for influencing expenditures rather than taxation."
    },
    {
      "heading": "Key Findings",
      "content": "- Pre-election period:\n  - Increased development spending.\n  - Increased overall primary expenditure.\n- Post-election period:\n  - In some cases, retrenchment (reductions) in spending following elections.\n- Revenue behavior:\n  - Revenue was not statistically significantly related to elections in either the pre- or post-election period.\n- Interpretation:\n  - Results are consistent with rational opportunistic political business cycle theory.\n  - Electoral fiscal manipulation is conducted primarily through expenditure adjustments rather than tax changes."
    },
    {
      "heading": "Methodology and Data",
      "content": "- Frequency: Quarterly time series data.\n- Empirical approach: Statistical testing of fiscal variables around election periods to detect opportunistic electoral budget cycles."
    },
    {
      "heading": "Policy Implications",
      "content": "- Fiscal management focus:\n  - Since incumbents tend to influence expenditures rather than revenues around elections, fiscal oversight and rules aimed at expenditure control may be particularly relevant for preventing opportunistic cycles.\n- Monitoring and transparency:\n  - Enhanced monitoring of development spending and primary expenditure during pre-election periods could mitigate opportunistic manipulation.\n- Revenue policy:\n  - Given the lack of statistically significant electoral effects on revenue, reforms focused solely on tax-side instruments may be insufficient to curb pre-election fiscal expansions.\n\n---\n\n Content in this bundle\n\n- wp07219\n  - wp07219 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - wp07219 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/political-budget-cycles-in-papua-new-guinea-21281"
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    "Authors: Ebrima A Faal",
    "Published: September 1, 2007",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451867831.001",
    "This paper assesses the presence of opportunistic electoral budget cycles in Papua New Guinea.",
    "Using quarterly time series data, the paper identifies a clear pattern of pre-election manipulations of fiscal policy by incumbent governments, mainly in the form of increased development spending and overall primary expenditure, followed in some cases by retrenchment in post-election periods.",
    "The findings are described as consistent with the predictions of rational opportunistic political business cycle theory.",
    "Revenue was not statistically significantly related to elections, either in the pre- or post-election period, implying electoral swings in fiscal deficits reflect a preference for influencing expenditures rather than taxation.",
    "Pre-election period:",
    "Post-election period:",
    "Revenue behavior:",
    "Interpretation:",
    "Frequency: Quarterly time series data.",
    "Empirical approach: Statistical testing of fiscal variables around election periods to detect opportunistic electoral budget cycles.",
    "Fiscal management focus:",
    "Monitoring and transparency:",
    "Revenue policy:",
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