Is Fiscal Policy Procyclical in Developing Oil-Producing Countries?
This paper examines the cyclicality of fiscal behavior in 28 developing oil-producing countries (OPCs) during 1990-2009. After testing five fiscal measures - government expenditure, consumption, investment, non-oil revenue, and non-oil primary balance - and correcting for reverse causality between non-oil output and fiscal variables, the results suggest that all of the five fiscal variables are strongly procyclical in the full sample. Also, the results are not uniform across income groups: expenditure is procyclical in the low and middle-income countries, while it is countercyclical in the high-income countries. Fiscal policy tends to be affected by the external financing constraints in the middle- and high-income groups. However, the quality of institutions and political structure appear to be more significant for the low-income group.
|Date of creation:||01 Jul 2011|
|Contact details of provider:|| Postal: International Monetary Fund, Washington, DC USA|
Phone: (202) 623-7000
Fax: (202) 623-4661
Web page: http://www.imf.org/external/pubind.htm
More information through EDIRC
|Order Information:||Web: http://www.imf.org/external/pubs/pubs/ord_info.htm|
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.:
- Reinhart, Carmen, 2004.
"Debt intolerance: Executive summary,"
13398, University Library of Munich, Germany.
- Reinhart, Carmen & Calvo, Guillermo, 2002.
"Fear of floating,"
14000, University Library of Munich, Germany.
- Ugo Panizza & Dany Jaimovich, 2007.
"Procyclicality or Reverse Causality?,"
IDB Publications (Working Papers)
6843, Inter-American Development Bank.
- Arezki, Rabah & Ismail, Kareem, 2013.
"Boom–bust cycle, asymmetrical fiscal response and the Dutch disease,"
Journal of Development Economics,
Elsevier, vol. 101(C), pages 256-267.
- Kareem Ismail & Rabah Arezki, 2010. "Boom-Bust Cycle, Asymmetrical Fiscal Response and the Dutch Disease," IMF Working Papers 10/94, .
- International Monetary Fund, 2010. "Fiscal Policy in Oil Producing Countries During the Recent Oil Price Cycle," IMF Working Papers 10/28, .
- Lucie Gadenne & Victor D. Lledó & Irene Yackovlev, 2011.
"A Tale of Cyclicality, Aid Flows and Debt: Government Spending in Sub-Saharan Africa,"
- Victor D. Lledó & Irene Yackovlev & Lucie Gadenne, 2011. "A Tale of Cyclicality, Aid Flows and Debt: Government Spending in Sub-Saharan Africa," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 20(5), pages 823-849, November.
- Irene Yackovlev & Victor Duarte Lledo & Lucie Gadenne, 2009. "Cyclical Patterns of Government Expenditures in Sub-Saharan Africa; Facts and Factors," IMF Working Papers 09/274, .
- Kit Baum, 2007. "Instrumental variables: Overview and advances," United Kingdom Stata Users' Group Meetings 2007 12, Stata Users Group.
- repec:idb:wpaper:326 is not listed on IDEAS
- Ethan Ilzetzki & Carlos A. Vegh, 2008. "Procyclical Fiscal Policy in Developing Countries: Truth or Fiction?," NBER Working Papers 14191, National Bureau of Economic Research, Inc.
- Sachs, J-D & Warner, A-M, 1995.
"Natural Resource Abundance and Economic Growth,"
517a, Harvard - Institute for International Development.
- Michael Gavin & Ricardo Hausmann & Roberto Perotti & Ernesto Talvi, 1996.
"Managing Fiscal Policy in Latin America and the Caribbean: Volatility, Procyclicality, and Limited Creditworthiness,"
Research Department Publications
4032, Inter-American Development Bank, Research Department.
- Michael Gavin & Ricardo Hausmann & Roberto Perotti & Ernesto Talvi, 1996. "Managing Fiscal Policy in Latin America and the Caribbean: Volatility, Procyclicality, and Limited Creditworthiness," IDB Publications (Working Papers) 6797, Inter-American Development Bank.
- Reinhart, Carmen & Kaminsky, Graciela & Vegh, Carlos, 2004.
"When it rains, it pours: Procyclical capital flows and macroeconomic policies,"
13883, University Library of Munich, Germany.
- Graciela L. Kaminsky & Carmen M. Reinhart & Carlos A. Végh, 2005. "When It Rains, It Pours: Procyclical Capital Flows and Macroeconomic Policies," NBER Chapters, in: NBER Macroeconomics Annual 2004, Volume 19, pages 11-82 National Bureau of Economic Research, Inc.
- Graciela L. Kaminsky & Carmen M. Reinhart & Carlos A. Vegh, 2004. "When it Rains, it Pours: Procyclical Capital Flows and Macroeconomic Policies," NBER Working Papers 10780, National Bureau of Economic Research, Inc.
- Ludvig SÃ¶derling & Hanan Morsy & Martin Petri & Martin Hommes & Manal Fouad & Wojciech Maliszewski, 2007. "Public Debt and Fiscal Vulnerability in the Middle East," IMF Working Papers 07/12, .
- Ugo Fasano-Filho, 2000. "Review of the Experience with Oil Stabilization and Savings Funds in Selected Countries," IMF Working Papers 00/112, .
- Robert Barro, 1973. "The control of politicians: An economic model," Public Choice, Springer, vol. 14(1), pages 19-42, March.
When requesting a correction, please mention this item's handle: RePEc:imf:imfwpa:11/171. 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: (Jim Beardow)or (Hassan Zaidi)
If references are entirely missing, you can add them using this form.