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What Should Fiscal Councils Do?

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Author Info

  • Calmfors, Lars

    ()
    (Institute for International Economic Studies, Stockholm University)

  • Wren-Lewis, Simon

    ()
    (Department of Economics, Merton College, Oxford University)

Abstract

The paper analyses theoretically what role fiscal councils could play and surveys empirically the activities of existing councils. Case studies of the Swedish Fiscal Policy Council and the UK Office for Budget Responsibility are done. It is concluded that fiscal councils should be advisory, rather than decision-making, and work as complements, rather than substitutes, to fiscal rules. A key issue is the political fragility of fiscal councils and how their long-run viability should be secured. Three ways of guaranteeing their independence are suggested: (1) reputation-building; (2)formal national rules; and (3) international monitoring.

(This abstract was borrowed from another version of this item.)

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Bibliographic Info

Paper provided by Stockholm University, Institute for International Economic Studies in its series Seminar Papers with number 768.

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Length: 67 pages
Date of creation: 01 Dec 2010
Date of revision:
Handle: RePEc:hhs:iiessp:0768

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Postal: Institute for International Economic Studies, Stockholm University, S-106 91 Stockholm, Sweden
Phone: +46-8-162000
Fax: +46-8-161443
Web page: http://www.iies.su.se/
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Keywords: Fiscal policy Council; Fiscal policy; Government policy;

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References

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  1. Simon Wren-Lewis, 2010. "Macroeconomic policy in light of the credit crunch: the return of counter-cyclical fiscal policy?," Oxford Review of Economic Policy, Oxford University Press, vol. 26(1), pages 71-86, Spring.
  2. Stephanie Schmitt-Grohe & Martin Uribe, 2002. "Optimal Fiscal and Monetary Policy Under Sticky Prices," NBER Working Papers 9220, National Bureau of Economic Research, Inc.
  3. Simon Wren-Lewis, 2011. "Comparing the delegation of monetary and fiscal policy," Economics Series Working Papers 540, University of Oxford, Department of Economics.
  4. Leith, Campbell & Wren-Lewis, Simon, 2006. "Compatibility between monetary and fiscal policy under EMU," European Economic Review, Elsevier, vol. 50(6), pages 1529-1556, August.
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Citations

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Where Austerity Really Rules
    by Mainly Macro in Mainly Macro on 2013-03-01 18:18:00
  2. More on Naive Fiscal Cynicism
    by Mainly Macro in Mainly Macro on 2013-05-06 16:19:00
  3. Time inconsistency and debt
    by Mainly Macro in Mainly Macro on 2014-03-28 16:35:00
  4. Euro Deja Vu?
    by Mainly Macro in Mainly Macro on 2012-02-03 12:26:00
  5. Fiscal councils: births, and the trials of youth
    by Mainly Macro in Mainly Macro on 2012-07-05 15:09:00
  6. Keynes, Counter-cyclical Fiscal Policy & a Way Out of Eurozone Crisis
    by Guest Author in The Big Picture on 2012-09-05 12:30:01
  7. The work of John Maynard Keynes shows us that counter-cyclical fiscal policy and an easing of austerity may offer a way out of Eurozone crisis
    by Blog Admin in British Politics and Policy at LSE on 2012-08-25 13:30:22
  8. Why politicians ignore economists on austerity
    by Mainly Macro in Mainly Macro on 2013-03-04 20:52:00
  9. Petit précis de règles budgétaires
    by ? in D'un champ l'autre on 2014-05-19 23:31:00
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
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Cited by:
  1. Catherine Mathieu & Henri Sterdyniak, 2012. "Faut-il des règles de politique budgétaire ?," Sciences Po publications 2012-07, Sciences Po.
  2. André Grjebine, 2013. "L’Eurosystème: un mécanisme de transferts en faveur des pays déficitaires ? Le débat," Sciences Po publications info:hdl:2441/eo6779thqgm, Sciences Po.
  3. Douglas Sutherland & Peter Hoeller & Rossana Merola, 2012. "Fiscal Consolidation: Part 1. How Much is Needed and How to Reduce Debt to a Prudent Level?," OECD Economics Department Working Papers 932, OECD Publishing.
  4. Jonathan Portes, 2014. "Issues in the Design of Fiscal Policy Rules," NIESR Discussion Papers 11865, National Institute of Economic and Social Research.
  5. Nerlich, Carolin & Reuter, Wolf Heinrich, 2013. "The design of national fiscal frameworks and their budgetary impact," Working Paper Series 1588, European Central Bank.
  6. Flodén, Martin, 2012. "A Role Model for the Conduct of Fiscal Policy? Experiences from Sweden," CEPR Discussion Papers 9095, C.E.P.R. Discussion Papers.
  7. Baldi, Guido, 2013. "Fiscal Policy Institutions and Economic Transition in North Africa," MPRA Paper 48677, University Library of Munich, Germany.
  8. Simon Wren-Lewis & Jonathan Portes, 2014. "Issues in the Design of Fiscal Policy Rules," Economics Series Working Papers 704, University of Oxford, Department of Economics.
  9. Andrew Hughes Hallett, 2013. "Is Independence Possible in an Interdependent World? Scotland vs. the UK's Participation in the European Economy," Bruges European Economic Policy Briefings 30, European Economic Studies Department, College of Europe.
  10. repec:spo:wpecon:info:hdl:2441/eo6779thqgm5r489maqa474kg is not listed on IDEAS
  11. Bos, Frits & Teulings, Coen, 2011. "Evaluating election platforms: a task for fiscal councils? Scope and rules of the game in view of 25 years of Dutch practice," MPRA Paper 31536, University Library of Munich, Germany.
  12. Blume, Lorenz & Voigt, Stefan, 2013. "The economic effects of constitutional budget institutions," European Journal of Political Economy, Elsevier, vol. 29(C), pages 236-251.
  13. Michael Bergman, 2011. "Best in Class: Public Finances in Sweden during the Financial Crisis," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 58(4), pages 431-453, December.
  14. repec:spo:wpecon:info:hdl:2441/eo6779thqgm5r489m6u1i2a0o is not listed on IDEAS
  15. World Bank, 2013. "World Development Report 2014," World Bank Publications, The World Bank, number 16092, July.
  16. Haffert, Lukas & Mehrtens, Philip, 2013. "From austerity to expansion? Consolidation, budget surpluses, and the decline of fiscal capacity," MPIfG Discussion Paper 13/16, Max Planck Institute for the Study of Societies.
  17. Dolls, Mathias & Peichl, Andreas & Zimmermann, Klaus F., 2011. "Eine Herausforderung für die G20: Global vereinbarte Schuldenbremsen und transnationale fiskalpolitische Aufsichtsgremien," IZA Standpunkte 45, Institute for the Study of Labor (IZA).
  18. Andersen, Torben M., 2013. "Fiscal policy targeting under imperfect information," Journal of International Money and Finance, Elsevier, vol. 34(C), pages 114-130.

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