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Fiscal issues in macroeconomic stabilization

Author

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  • Taylor, Lance

Abstract

A key question for stabilization programs concerns how governments get into fiscal difficulty in the first place. Accordingly, this paper is about fiscal policy issues that arise during such macroeconomic stabilization in developing economies. Specifically, this report sets out the basics, as they apply in the World Institute for Development Economics Research (WIDER) studies and takes up three theories about the fiscal deficit. According to these theories, deficits may arise because of political or structural reasons, or perhaps because the relevant authorities want to maximize revenue from the inflation tax. The report also discusses the effects of deficit reduction, a central component of orthodox stabilization packages and examines other fiscal topics brought up in the WIDER country papers.

Suggested Citation

  • Taylor, Lance, 1988. "Fiscal issues in macroeconomic stabilization," Policy Research Working Paper Series 34, The World Bank.
    • Handle: RePEc:wbk:wbrwps:34
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    Cited by:

    1. Gleizer, Daniel Luiz, 1992. "Government saving and private saving in Brazil," Revista Brasileira de Economia - RBE, EPGE Brazilian School of Economics and Finance - FGV EPGE (Brazil), vol. 46(3), July.

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