Monitoring sub-central government spending in Spain
AbstractThe evolution of Regional and Local governments’ spending in Spain is currently under close scrutiny by national and international investors and analysts, international organizations and rating agencies. Indeed, some 50% of general government spending and some 70% of public employment are managed by Regions and Municipalities, which consequently have to bear a great portion of the overall fiscal consolidation plan currently under way. Despite recent efforts of the Spanish government at increasing transparency, the significant shortages of the existing data render the task of monitoring regional and local governments’ public spending in real-time a complicated endeavor. Within this framework, we exploit all available short-term information on sub-national governments’ spending from scattered sources, and find a subset of indicators usable for real-time policy analysis. In particular: (i) we compile a dataset on quarterly and monthly regional government’s spending variables, by reviewing all available, scattered sources, and put together a database usable for economic and policy analysis; (ii) we exploit the compiled information, and other additional sources, by fitting time-series mixed-frequencies models to the data, and show the forecasting and monitoring capabilities of the selected short-term fiscal indicators; (iii) we show that official annual budgetary targets do present a reasonable forecasting performance when used as indicators of regional and local spending targets in national accounts terms, in particular when used in combination with time series indicators.
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Bibliographic InfoPaper provided by Banco de Espa�a in its series Banco de Espa�a Working Papers with number 1127.
Length: 38 pages
Date of creation: Oct 2011
Date of revision:
Regional and local public finances; government expenditure; fiscal forecasting;
Other versions of this item:
- Laura Fernández-Caballero & Diego J. Pedregal & Javier J. Pérez, 2012. "Monitoring Sub-central Government Spending in Spain," Hacienda Pública Española, IEF, vol. 202(3), pages 77-104, September.
- E17 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Forecasting and Simulation: Models and Applications
- E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
- H68 - Public Economics - - National Budget, Deficit, and Debt - - - Forecasts of Budgets, Deficits, and Debt
- H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-11-01 (All new papers)
- NEP-FOR-2011-11-01 (Forecasting)
- NEP-GEO-2011-11-01 (Economic Geography)
- NEP-MAC-2011-11-01 (Macroeconomics)
- NEP-URE-2011-11-01 (Urban & Real Estate Economics)
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- Javier J. Pérez & Rocío Prieto, 2014. "The structure of sub-natural public debt: Liquidity vs credit risk," Banco de Espaï¿½a Working Papers 1403, Banco de Espa�a.
- Roberto Fernández Llera & María A. García Valiñas, 2013. "The Role of Regional Public Enterprises in Spain: Room for a Shadow Government?," Hacienda Pública Española, IEF, vol. 205(2), pages 9-31, June.
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