Fiscal Solvency and Fiscal Forecasting in Europe

IGIER Working Paper No. 142

40 Pages Posted: 21 Jul 1998

See all articles by Michael J. Artis

Michael J. Artis

University of Manchester - Institute for Political & Economic Governance (IPEG)

Massimiliano Giuseppe Marcellino

Bocconi University - Department of Economics; Centre for Economic Policy Research (CEPR)

Date Written: September 1998

Abstract

This paper analyzes two features of concern to policy-makers in the countries of the prospective European Monetary Union: the solvency of their government's finances and the accuracy of fiscal forecasts. Extending the existing methodology of solvency tests, the paper finds that, with few exceptions, EU governments are insolvent, albeit debt/GDP ratios show signs of stabilizing. The accuracy of official short-term fiscal forecasts (those of the OECD) is analyzed, using conventional techniques, and found to be reassuring.

JEL Classification: C22, D99, E62, H63

Suggested Citation

Artis, Michael J. and Marcellino, Massimiliano, Fiscal Solvency and Fiscal Forecasting in Europe (September 1998). IGIER Working Paper No. 142, Available at SSRN: https://ssrn.com/abstract=106383 or http://dx.doi.org/10.2139/ssrn.106383

Michael J. Artis

University of Manchester - Institute for Political & Economic Governance (IPEG) ( email )

Oxford Road
Manchester, M13 9PL
United Kingdom

Massimiliano Marcellino (Contact Author)

Bocconi University - Department of Economics ( email )

Via Gobbi 5
Milan, 20136
Italy

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

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