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Budget Transparency and Fiscal Performance: Lessons for Nigeria and Sri Lanka

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Abstract

A transparent budget process is expected to promote better fiscal performance in terms of sound primary balance and debt profile. However, there is no consensus on the relationship between budget transparency and fiscal performance. This paper contributes to the literature by examining the relationship between budget transparency as well as primary balance, and debt and provision of key infrastructure. Data were collected for countries in South Asia and West Africa. The analysis shows relatively strong positive relationship between budget transparency and primary balance. A weak positive relationship between transparency with debt and moderately positive relationship with infrastructure is observed. It is also observed that budget transparency is limited across the countries in South Asia and West Africa, particularly in Nigeria and Sri Lanka. The paper therefore recommended that Nigeria and Sri Lanka should practice a more transparent budget process by: (i) making information in budget documents more comprehensive; (ii) publishing all budget documents at the right time; and (iii) allowing public participation at all stages of the budget process.

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  • A. Abdulhakeem, Kilishi,, 2020. "Budget Transparency and Fiscal Performance: Lessons for Nigeria and Sri Lanka," Working Papers 5, Department of Economics, University of Ilorin.
    • Handle: RePEc:ris:decilo:0005
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    References listed on IDEAS

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    1. Lucie Sedmihradská & Jakub Haas, 2013. "Budget Transparency and Fiscal Performance: Do Open Budgets Matter?," ACTA VSFS, University of Finance and Administration, vol. 7(2), pages 109-122.
    2. Alt, James E. & Lassen, David Dreyer, 2006. "Fiscal transparency, political parties, and debt in OECD countries," European Economic Review, Elsevier, vol. 50(6), pages 1403-1439, August.
    3. Seabright, Paul, 1996. "Accountability and decentralisation in government: An incomplete contracts model," European Economic Review, Elsevier, vol. 40(1), pages 61-89, January.
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