A Disaggregated Framework for the Analysis of Structural Developments in Public Finances

36 Pages Posted: 16 Feb 2012  

Jana Kremer

Deutsche Bundesbank

Cláudia Rodrigues Braz

Bank of Portugal

Teunis Brosens

De Nederlandsche Bank (Dutch Central Bank)

Geert Langenus

National Bank of Belgium

Sandro Momigliano

Bank of Italy

Mikko Spolander

Bank of Finland

Multiple version iconThere are 3 versions of this paper

Date Written: February 14, 2012

Abstract

In this paper, we present a disaggregated framework for the analysis of past and projected structural developments in the most relevant revenue and expenditure categories and the fiscal balance. The framework, in particular, distinguishes between the effects of discretionary fiscal policy and of macroeconomic and other developments and is sufficiently standardised to be used in multi-country studies. Here, it is applied to Belgium, Finland, Germany, Italy, the Netherlands and Portugal over the period 1998 to 2004. During this period the structural primary balance ratio clearly worsened in all countries except Finland. In Belgium, Italy and the Netherlands, both revenue and expenditure contributed to the deterioration of the structural primary balance. In Germany the large deterioration in revenue was partially offset by the decline in the structural primary expenditure ratio, while the opposite was true for Portugal. The analysis highlights the various factors that contributed to these developments.

Keywords: structural budget balance, fiscal forecasting and monitoring, fiscal indicators

JEL Classification: H20, H50, H60, E69

Suggested Citation

Kremer, Jana and Rodrigues Braz, Cláudia and Brosens, Teunis and Langenus, Geert and Momigliano, Sandro and Spolander, Mikko, A Disaggregated Framework for the Analysis of Structural Developments in Public Finances (February 14, 2012). Available at SSRN: https://ssrn.com/abstract=2005009 or http://dx.doi.org/10.2139/ssrn.2005009

Jana Kremer (Contact Author)

Deutsche Bundesbank ( email )

Wilhelm-Epstein-Str. 14
D-60431 Frankfurt/Main
Germany

Cláudia Rodrigues Braz

Bank of Portugal ( email )

Rua Francisco Ribeiro, 2
Lisbon, 1150-165
Portugal

Teunis Brosens

De Nederlandsche Bank (Dutch Central Bank) ( email )

PO Box 98
1000 AB Amsterdam
Amsterdam, 1000 AB
Netherlands
+31 20 524 2506 (Fax)

HOME PAGE: http://www.dnb.nl

Geert Langenus

National Bank of Belgium ( email )

Brussels, B-1000
Belgium

Sandro Momigliano

Bank of Italy ( email )

Via Nazionale 91
Rome, 00184
Italy

Mikko Spolander

Bank of Finland ( email )

P.O. Box 160
FIN-00101 Helsinki
Finland
+358 9 1831 (Phone)

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