The global crisis had a severe impact on the Italian economy despite elements of strength such as high private savings, low private indebtedness, and a resilient financial system. Executive Directors decided that the public sector wage bill should remain a key element of the consolidation...

Portugal’s economic adjustment has continued, but the contraction in output has been milder than expected. The 2012 outlook for Europe has deteriorated substantially, with growth revised down by 1¼ percentage points relative to spring forecasts. Substantially higher capital...

Robust GDP growth, declining unemployment, low and stable inflation, and a string of fiscal and current account surpluses -- it's a record to be envied. These outcomes in Canada owe much to sound macroeconomic policies, as well as to a favorable external environment. This book focuses on these...

This 2005 Article IV Consultation highlights that economic growth in Greece has been strong for several years, underpinned by a large fall in interest rates owing to adoption of the euro and subsequent European Central Bank easing. In 2005, the authorities implemented substantial fiscal...

The Czech Republic has embarked on an ambitious tax reform and expenditure package to bring the deficit sustainably below 3 percent, and intends to reduce the deficit to 1 percent of GDP by 2012. To address the long-term fiscal challenge due to population aging, pension reform proposals are also...

This paper presents an overview of recent U.S. fiscal developments and discusses possible implications of the sharp turn around in the government’s fiscal position. Against this back ground, it also reviews key policy challenges that will need to be addressed to cope with the mounting...

This paper investigates if there are circumstances where time-varying tax rates could improve welfare and whether such policy can effectively be implemented in practice. While, in principle, variable taxes could improve welfare in some cases, the paper highlights the very particular...

Fiscal rules—legal restrictions on government borrowing, spending, or debt accumulation (like the Gramm-Rudman-Hollings Act in the United States)—have recently been adopted or considered in several countries, both industrial and developing. Previous literature stresses that such laws...

Over the past several years, implementation of IMF recommendations has been lacking not so much in intention as in pace and timing owing to political economy considerations and a strong social preference for publicly provided services. The discussions focused on how to foster a durable economic...

External shocks pose major challenges to fiscal policy makers through lower output and large fiscal imbalances. This paper analyzes the case of Moldova, which faced parallel crises a decade apart: the Russian crisis of 1998 and the global financial crisis of 2008-2009. The country went through...