IDEAS home Printed from https://ideas.repec.org/p/ise/isegwp/wp192006.html
   My bibliography  Save this paper

Political and Institutional Determinants of the Cyclicality of Fiscal Policy: Evidence from the OECD and Latin America

Author

Listed:
  • Nuno Venes

Abstract

In this paper, we analyse the role of political and institutional variables on the cyclical patterns of central government expenditure and revenue. Working with a sample of 38 OECD and Latin-American countries in 1960-2003, we find that higher levels of income inequality are associated with stronger expenditure procyclicality, and that better institutions do not seem to mitigate this effect. IMF interventions are, in general, statistically insignificant in explaining the cyclical behaviour of expenditure, as well as the degree of development of financial systems. On the revenue side, income inequality leads to less procyclical policies. In general, political and institutional variables explain the cyclicality of government expenditure better than that of revenue.

Suggested Citation

  • Nuno Venes, 2006. "Political and Institutional Determinants of the Cyclicality of Fiscal Policy: Evidence from the OECD and Latin America," Working Papers Department of Economics 2006/19, ISEG - Lisbon School of Economics and Management, Department of Economics, Universidade de Lisboa.
    • Handle: RePEc:ise:isegwp:wp192006
    as

    Download full text from publisher

    File URL: https://depeco.iseg.ulisboa.pt/wp/wp192006.pdf
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    Fiscal policy; cyclicality; political and institutional determinants; OECD; Latin America;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H61 - Public Economics - - National Budget, Deficit, and Debt - - - Budget; Budget Systems

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ise:isegwp:wp192006. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Vitor Escaria (email available below). General contact details of provider: https://aquila.iseg.ulisboa.pt/aquila/departamentos/EC .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.