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Do National Numerical Fiscal Rules really shape fiscal behaviours in developing countries? A treatment effect evaluation

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  • Tapsoba, René

Abstract

This paper analyses the effect of National Numerical Fiscal Rules (FRs) upon fiscal discipline in 74 developing countries over the period 1990–2007. It is the first study that assesses the impact of FRs on budgetary outcomes while controlling for the self-selection problem. It finds that the effect of FRs on structural fiscal balance is significantly positive, robust to a variety of alternative specifications, and varies with the type of FRs. It also finds that the treatment effect differs according to countries' characteristics: number of FRs, time length since FRs adoption, presence of supranational FRs, government fractionalisation and government stability.

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Bibliographic Info

Article provided by Elsevier in its journal Economic Modelling.

Volume (Year): 29 (2012)
Issue (Month): 4 ()
Pages: 1356-1369

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Handle: RePEc:eee:ecmode:v:29:y:2012:i:4:p:1356-1369

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Web page: http://www.elsevier.com/locate/inca/30411

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Keywords: Fiscal Rules; Fiscal discipline; Treatment effect; Propensity scores-matching; Developing countries;

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Cited by:
  1. Jean-Louis Combes & Xavier Debrun & Alexandru Minea & Rene Tapsoba, 2014. "Inflation Targeting and Fiscal Rules: Do Interactions and Sequencing Matter?," IMF Working Papers 14/89, International Monetary Fund.
  2. Christian Mumssen & Yasemin Bal-Gunduz & Christian Ebeke & Linda Kaltani, 2013. "IMF-Supported Programs in Low Income Countries: Economic Impact over the Short and Longer Term," IMF Working Papers 13/273, International Monetary Fund.
  3. Pierre MANDON, 2014. "Evaluating Treatment Effect and Causal Effect of Fiscal Rules on Procyclicality New assessments on old debate: rules vs. discretion," Working Papers halshs-01015760, HAL.
  4. Chakraborty, Pinaki & Dash, Bharatee Bhusana, 2013. "Fiscal Reforms, Fiscal Rule and Development Spending: How Indian States have Performed?," Working Papers 13/122, National Institute of Public Finance and Policy.
  5. Pierre MANDON, 2014. "Evaluating Treatment Effect and Causal Effect of Fiscal Rules on Procyclicality New assessments on old debate: rules vs. discretion," Working Papers halshs-01015756, HAL.

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