IFC as the debt bias would fall. However, when other considerations eclipse competence and give the incumbent a strong … electoral advantage or disadvantage, setting up an IFC may be counterproductive as the debt bias would increase. If the … bias if voters care sufficiently about policymakers' competence; (ii) not all political environments are conducive to the …

in the budgetary process expenditure policy might be prone to a pro-cyclical bias. However, this tendency may be … changes in the output gap, and (ii) numerical expenditure rules reduce this pro-cyclical bias. Moreover, the pro …-cyclical spending bias is found to be particularly pronounced for spending items with a high degree of budgetary flexibility …