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The usefulness of infra-annual government cash budgetary data for fiscal forecasting in the euro area

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  • Onorante, Luca
  • Pedregal, Diego J.
  • Pérez, Javier J.
  • Signorini, Sara

Abstract

Short-term fiscal indicators based on public accounts data are often used by European policy makers. These indicators represent one of the main sources of publicly available intra-annual fiscal information. Nevertheless, they are not formally included in the European multilateral fiscal surveillance process, and have received limited attention from the academic literature analysing fiscal policies and fiscal forecasting in Europe. By focusing on a broad set of indicators (some 50 fiscal revenue and expenditure items for euro area countries) and a mixed-frequency state-space econometric model, we make a case for the use of monthly cash indicators for multilateral fiscal surveillance at the European level. Their formal use in the public discussion would certainly enhance the pre-emptive arm of the Stability and Growth Pact, making possible to acknowledge fiscal slippages early enough so that pressure to take corrective measures could be set on governments by EU institutions and the public at large.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Policy Modeling.

Volume (Year): 32 (2010)
Issue (Month): 1 (January)
Pages: 98-119

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Handle: RePEc:eee:jpolmo:v:32:y::i:1:p:98-119

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Web page: http://www.elsevier.com/locate/inca/505735

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Keywords: C53 E6 H6 Fiscal forecasting and monitoring Stability and Growth Pact Fiscal policies Euro area;

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Cited by:
  1. Teresa Leal & Diego Pedregal & Javier Pérez, 2011. "Short-term monitoring of the Spanish government balance," SERIEs, Spanish Economic Association, vol. 2(1), pages 97-119, March.
  2. António Afonso & Ricardo M. Sousa, 2009. "The Macroeconomic Effects of Fiscal Policy in Portugal: a Bayesian SVAR Analysis," Working Papers Department of Economics 2009/09, ISEG - School of Economics and Management, Department of Economics, University of Lisbon.
  3. Teresa Leal Linares & Javier J. Pérez, 2009. "Un sistema ARIMA con agregación temporal para la previsión y el seguimiento del déficit del Estado," Hacienda Pública Española, IEF, vol. 190(3), pages 27-58, June.
  4. António Afonso & Luca Agnello & Davide Furceri & Ricardo M. Sousa, 2009. "Assessing Long-Term Fiscal Developments: a New Approach," NIPE Working Papers 7/2009, NIPE - Universidade do Minho.
  5. Pedregal, Diego J. & Pérez, Javier J., 2008. "Should quarterly government finance statistics be used for fiscal surveillane in Europe?," Working Paper Series 0937, European Central Bank.
  6. Bianchi, Giuseppe & Cesaroni, Tatiana & Ricchi, Ottavio, 2010. "Previsioni delle Spese del Bilancio dello Stato attraverso i flussi di contabilità finanziaria
    [Forecasting Budget Expenditures using budget entities]
    ," MPRA Paper 27440, University Library of Munich, Germany.
  7. Andrew Hughes Hallett & Moritz Kuhn & Thomas Warmedinger, 2012. "The gains from early intervention in Europe: Fiscal surveillance and fiscal planning using cash data," European Journal of Government and Economics, Europa Grande, vol. 1(1), pages 44-65, June.
  8. Asimakopoulos, Stylianos & Paredes, Joan & Warmedinger, Thomas, 2013. "Forecasting fiscal time series using mixed frequency data," Working Paper Series 1550, European Central Bank.
  9. Diego J. Pedregal & Javier J. Pérez & A. Jesús Sánchez-Fuentes, 2014. "A toolkit to strengthen government budget surveillance," Banco de Espa�a Working Papers 1416, Banco de Espa�a.

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