Quantitative Approaches To Fiscal Sustainability Analysis [electronic resource] : A New World Bank Tool Applied To Turkey / Budina, Nina
Material type: TextPublication details: Washington, D.C., The World Bank, 2007Description: 1 online resource (41 p.)Subject(s): Balance of Payments | Balance of Payments Crises | Bank Policy | Banks and Banking Reform | Budget | Business Cycle | Central Bank | Currencies and Exchange Rates | Debt | Debt Management | Debt Management Policies | Debt Markets | Economic Stabilization | Economic Theory and Research | Emerging Markets | Exchange | External Debt | Finance and Financial Sector Development | Financial Literacy | Fiscal Deficits | Fiscal Policies | Fiscal Policy | Future | Guarantees | Inflation | International Economics & Trade | Investment | Investment Decisions | Liabilities | Macroeconomic Management | Macroeconomics and Economic Growth | Monetary Policy | Private Sector Development | Public Sector Expenditure Analysis and ManagementAdditional physical formats: Budina, Nina.: Quantitative Approaches To Fiscal Sustainability Analysis.Online resources: Click here to access online Abstract: Fiscal sustainability analysis (FSA) is an important component of macroeconomic analysis. The authors review various quantitative approaches to FSA with a major objective to bring these approaches together and to present a user-friendly tool for FSA that reflects modern developments. They combine a dynamic simulations approach with a simplified version of the steady-state consistency approach. They also incorporate two different methods to deal with uncertainty: user-defined stress tests and stochastic simulations. The tool goes further by evaluating the required fiscal adjustment as a consequence of the stochastic realizations of the exogenous variables. Furthermore, the fiscal sustainability tool incorporates an endogenous debt feedback rule for the primary surplus, a fiscal policy reaction function. Besides outlining the theoretical framework, the authors also present a case study for Turkey.Fiscal sustainability analysis (FSA) is an important component of macroeconomic analysis. The authors review various quantitative approaches to FSA with a major objective to bring these approaches together and to present a user-friendly tool for FSA that reflects modern developments. They combine a dynamic simulations approach with a simplified version of the steady-state consistency approach. They also incorporate two different methods to deal with uncertainty: user-defined stress tests and stochastic simulations. The tool goes further by evaluating the required fiscal adjustment as a consequence of the stochastic realizations of the exogenous variables. Furthermore, the fiscal sustainability tool incorporates an endogenous debt feedback rule for the primary surplus, a fiscal policy reaction function. Besides outlining the theoretical framework, the authors also present a case study for Turkey.
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