This paper discusses a methodology for assessing the effects of a government budget on the economy, the "weighted budget balance" (WBB) approach, which is intermediate between using the simple budget balance and using a complete econometric model of the relationships between the budget and other...

Experience indicates that fiscal rules can be helpful as a disciplinary device at the central government level. This article explores whether fiscal rules could be usefully adopted in a decentralised framework, where the behaviour of subnational governments may undermine fiscal discipline.

Latin America has a long history of pro-cyclical fiscal policies, reflecting the region’s exposure to a range of exogenous shocks, tight financial constraints and relatively weak fiscal institutions. This paper discusses the role that structural balance-based fiscal rules (SFRs) could play in...