From First-Release to Ex-Post Fiscal Data: Exploring the Sources of Revision Errors in the EU
Roel M. W. J. Beetsma
University of Amsterdam - Research Institute in Economics & Econometrics (RESAM); Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute for Economic Research); Tinbergen Institute - Tinbergen Institute Amsterdam (TIA); Netspar
Goethe University Frankfurt - Graduate School of Economics, Finance and Management (GSEFM)
University of Amsterdam - Faculty of Economics & Econometrics (FEE); Tinbergen Institute - Tinbergen Institute Amsterdam (TIA)
De Nederlandsche Bank - Research Department
May 16, 2011
TI Discussion Paper 11-080/2
This paper explores the determinants of deviations of ex-post budget outcomes from first-release outcomes published towards the end of the year of budget implementation. The predictive content of the first-release outcomes is important, because these figures are an input for the next budget and the fiscal surveillance process. Deviations of ex-post from first-release fiscal figures may arise for political and strategic reasons. In particular, Ministries of Finance control the production of first-release figures, and may have an incentive to be over-optimistic at this stage. Our results suggest that an improvement in the quality of institutions, whether measured by the tightness of national fiscal rules, the medium-term budgetary framework or budgetary transparency, reduces the degree of optimism at the first-release stage, thereby making first-release figures more informative about the eventual outcomes. This supports the European Commission proposals for minimum standards for national fiscal frameworks and amendments by the European Parliament for improving national ownership. It also strengthens the case for a close monitoring by the Commission of the first-release production of fiscal figures.
Number of Pages in PDF File: 41
Keywords: real-time data, first-release data, ex-post data, fiscal policy, biases, decomposition, base effect, growth effect, denominator effect, fiscal institutions
JEL Classification: E6, H6working papers series
Date posted: May 26, 2011
© 2013 Social Science Electronic Publishing, Inc. All Rights Reserved.
This page was processed by apollo4 in 0.610 seconds