From First-Release to Ex-Post Fiscal Data: Exploring the Sources of Revision Errors in the EU

42 Pages Posted: 6 Jun 2011

See all articles by Roel M. W. J. Beetsma

Roel M. W. J. Beetsma

University of Amsterdam - Research Institute in Economics & Econometrics (RESAM); European Commission; Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute); Tinbergen Institute; Netspar

Benjamin Bluhm

affiliation not provided to SSRN

Massimo Giuliodori

University of Amsterdam - Faculty of Economics & Econometrics (FEE); Tinbergen Institute

Peter Wierts

De Nederlandsche Bank; VU University Amsterdam

Multiple version iconThere are 2 versions of this paper

Date Written: June 2011

Abstract

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.

Keywords: base effect, biases, decomposition, denominator effect, ex-post data, first-release data, fiscal institutions, fiscal policy, growth effect, real-time data

JEL Classification: E6, H6

Suggested Citation

Beetsma, Roel M. W. J. and Bluhm, Benjamin and Giuliodori, Massimo and Wierts, Peter, From First-Release to Ex-Post Fiscal Data: Exploring the Sources of Revision Errors in the EU (June 2011). CEPR Discussion Paper No. DP8413, Available at SSRN: https://ssrn.com/abstract=1857363

Roel M. W. J. Beetsma (Contact Author)

University of Amsterdam - Research Institute in Economics & Econometrics (RESAM) ( email )

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Centre for Economic Policy Research (CEPR)

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CESifo (Center for Economic Studies and Ifo Institute)

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Tinbergen Institute ( email )

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Netspar ( email )

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Benjamin Bluhm

affiliation not provided to SSRN

Massimo Giuliodori

University of Amsterdam - Faculty of Economics & Econometrics (FEE) ( email )

Roetersstraat 11
Amsterdam, 1018 WB
Netherlands

Tinbergen Institute ( email )

Gustav Mahlerplein 117
Amsterdam, 1082 MS
Netherlands

Peter Wierts

De Nederlandsche Bank ( email )

P.O. Box 98
1000 AB Amsterdam
Netherlands

VU University Amsterdam ( email )

De Boelelaan 1105
Amsterdam, 1081HV
Netherlands

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