The Colombian budget process
The rules that govern the budget process are important determinants of fiscal outcomes, with potentially important macroeconomic implications. This paper starts with a review of the theoretical underpinnings of the effects of budget processes and the main empirical evidence. After a brief institutional description of the Colombian budget process, an assessment and proposals for reform are made. The main issues analyzed here are the degree of centralization of the budget process, transparency, rules, and intertemporal links. Serious flaws have been detected: decentralization during the preparation of the budget, proliferation of budget documents, heterodox accounting standards and reporting for deficits and investment, insufficient coverage, biased forecasts and macro assumptions, unduly restrictive rules that promote creative accounting, or seemingly innocuous rules, and weak management of intertemporal links. It is recognized that better rules and institutions can be circumvented, but they can be important in realizing three conditions: allow the public a good understanding of fiscal policy and position, increase the incentives for fiscal discipline, and create an environment where a fiscally sound government can do its job more effectively, and a fiscally undisciplined government will be subject to a more informed scrutiny. These conditions can greatly enhance the scope for a more effective fiscal policy in Colombia.
|Date of creation:||01 Jun 2000|
|Contact details of provider:|| |
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- James M. Poterba, 1996. "Do Budget Rules Work?," NBER Working Papers 5550, National Bureau of Economic Research, Inc.
- von Hagen,Juergen, "undated".
"A note on the empirical effectiveness of formal fiscal restraints,"
Discussion Paper Serie B
155, University of Bonn, Germany.
- von Hagen, Jurgen, 1991. "A note on the empirical effectiveness of formal fiscal restraints," Journal of Public Economics, Elsevier, vol. 44(2), pages 199-210, March.
- Robert P. Inman, 1996. "Do Balanced Budget Rules Work? U.S. Experience and Possible Lessons for the EMU," NBER Working Papers 5838, National Bureau of Economic Research, Inc.
When requesting a correction, please mention this item's handle: RePEc:col:000123:002535. 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: (Lucía Fenney Pérez)
If references are entirely missing, you can add them using this form.