This paper is one of three in this Working Paper Series, along with those by Chouraqui et al. and Blanchard, in which the assessment of fiscal policy is reconsidered. It reviews the question of what type of budget indicators the OECD should compile. Instead of the cyclically-adjusted budget, it...

During the past decade, the formulation of fiscal policy has been increasingly founded on medium-term considerations associated with public debt and economic efficiency. In this regard, this paper, and the ones by Olivier Blanchard and Edward Gramlich in the same Working Paper Series, considers...

The aim of this paper is to assess the ability of social spending to smooth output shocks and to provide stabilization. The results show that overall social spending is able to smooth about 16 percent of a shock to GDP. Among its subcategories, social spending devoted to Old Age and Unemployment...

The world is recovering from the worst crisis since the Great Depression, leaving a strong and lasting impact on Member countries’ public finances. This paper analyses how sub-central governments (SCG) are affected and how fiscal policy has reacted in the first months after the outbreak of the...

This paper assesses how and in what circumstances, fiscal consolidations are affected by monetary conditions, using data covering 24 OECD countries over the past 25 years, Focusing on fiscal consolidation “episodes”, it is found that these tend to occur when large budget deficits threaten...