IDEAS home Printed from https://ideas.repec.org/a/ifs/fistud/v19y1998i1p63-81.html
   My bibliography  Save this article

Modelling and forecasting UK public finances

Author

Listed:
  • Andrew Sentance
  • Stephen Hall
  • John O'Sullivan

Abstract

In this paper, we present a new model of UK public finances which aims to shed light on recent problems of forecasting the PSBR. The main elements of public spending are treated as endogenous variables which rise in line with GDP over the medium term. Also, the cyclical response of public borrowing to rises in the level of economic activity is more muted when growth is export-led than when it is consumer-led. These two features go a long way towards explaining the rapid deterioration of public finances in the early 1990s and the slow pace of improvement since 1993.

Suggested Citation

  • Andrew Sentance & Stephen Hall & John O'Sullivan, 1998. "Modelling and forecasting UK public finances," Fiscal Studies, Institute for Fiscal Studies, vol. 19(1), pages 63-81, February.
  • Handle: RePEc:ifs:fistud:v:19:y:1998:i:1:p:63-81
    as

    Download full text from publisher

    File URL: http://www.ifs.org.uk/fs/articles/fsshos.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Baumol, William J, 1972. "Macroeconomics of Unbalanced Growth: Reply," American Economic Review, American Economic Association, vol. 62(1), pages 150-150, March.
    2. Tim Pike & David Savage, 1998. "Forecasting the public finances in the Treasury," Fiscal Studies, Institute for Fiscal Studies, vol. 19(1), pages 49-62, February.
    3. Engle, Robert & Granger, Clive, 2015. "Co-integration and error correction: Representation, estimation, and testing," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 39(3), pages 106-135.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Teresa Leal & Javier J. Pérez & Mika Tujula & Jean-Pierre Vidal, 2008. "Fiscal Forecasting: Lessons from the Literature and Challenges," Fiscal Studies, Institute for Fiscal Studies, vol. 29(3), pages 347-386, September.
    2. Chris Giles & John Hall, 1998. "Forecasting the PSBR outside government: the IFS perspective," Fiscal Studies, Institute for Fiscal Studies, vol. 19(1), pages 83-100, February.
    3. John Hall, 1998. "Private opportunity, public benefit?," Fiscal Studies, Institute for Fiscal Studies, vol. 19(2), pages 121-140, May.
    4. Creedy, John & Gemmell, Norman, 2005. "Wage growth and income tax revenue elasticities with endogenous labour supply," Economic Modelling, Elsevier, vol. 22(1), pages 21-38, January.

    More about this item

    JEL classification:

    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus

    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:ifs:fistud:v:19:y:1998:i:1:p:63-81. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Emma Hyman). General contact details of provider: http://edirc.repec.org/data/ifsssuk.html .

    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.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.