Abstract

http://ssrn.com/abstract=938594
 
 

References (32)



 


 



The Phasing of Fiscal Adjustments: What Works in Emerging Market Economies?


Emanuel Baldacci


Government of the Italian Republic (Italy) - National Institute of Statistics (Istat)

Benedict J. Clements


International Monetary Fund (IMF) - Expenditure Policy Division

Sanjeev Gupta


International Monetary Fund (IMF) - Fiscal Affairs Department

Carlos Mulas-Granados


Government of the Kingdom of Spain - Economic Bureau of the President


Review of Development Economics, Vol. 10, No. 4, pp. 612-631, November 2006

Abstract:     
This paper investigates the political and economic determinants of successful fiscal adjustment in 25 emerging market economies from 1980 to 2001. The results show that large and back-loaded fiscal adjustments have the highest likelihood of success. Fiscal consolidations based on expenditure cuts increase the probability of approaching and achieving fiscal sustainability but are insufficient to maintain it unless accompanied by revenue reforms. Adjustment episodes launched in countries where governments enjoy a parliamentary majority and do not face imminent elections, are found to be more successful. Fiscal consolidations undertaken under IMF-supported programs also have a higher probability of success.

Number of Pages in PDF File: 20

Accepted Paper Series





Date posted: October 19, 2006  

Suggested Citation

Baldacci, Emanuel and Clements, Benedict J. and Gupta, Sanjeev and Mulas-Granados, Carlos, The Phasing of Fiscal Adjustments: What Works in Emerging Market Economies?. Review of Development Economics, Vol. 10, No. 4, pp. 612-631, November 2006. Available at SSRN: http://ssrn.com/abstract=938594 or http://dx.doi.org/10.1111/j.1467-9361.2006.00336.x

Contact Information

Emanuel Baldacci
Government of the Italian Republic (Italy) - National Institute of Statistics (Istat) ( email )
Via Cesare Balbo 16
00184 Rome, 0185
Italy
Benedict Clements
International Monetary Fund (IMF) - Expenditure Policy Division ( email )
700 19th Street NW
Washington, DC 20431
United States
Sanjeev Gupta
International Monetary Fund (IMF) - Fiscal Affairs Department ( email )
700 19th Street, NW
Washington, DC 20431
United States
Carlos Mulas-Granados
Government of the Kingdom of Spain - Economic Bureau of the President ( email )
28071 Madrid
Spain
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