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Business and Economics > Public Finance

You are looking at 1 - 10 of 23 items for :

  • Type: Journal Issue x
  • Wage Level and Structure; Wage Differentials x
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Cover IMF Working Papers
Designing Expenditure Policy Conditionality in IMF-Supported Programs
Emine Hanedar
and
Zsuzsa Munkacsi
This gap-filling paper provides granular advice on how to design quantitative and structural conditionality of IMF-supported programs in six expenditure policy areas: social assistance, energy subsidies, pension spending, health spending, education spending, and wage bill management. Such granular advice is based on a stocktaking exercise: an analysis of 105 programs approved between 2002 and July 2021 containing a ca. 1400 conditions. Conditions are key to identify outcomes or actions seen as critical for program success or monitoring, and so are essential for financial support countries can receive from the Fund.
Keywords:
IMF-supported programs; conditionality; expenditure policy; social assistance; energy subsidies; pension spending; health spending; education spending; wage bill management; policy conditionality; policy area; IMF working papers; reform plan; E. public health spending; Health care spending; Caribbean; North Africa; Middle East; East Africa; Europe
Cover IMF Working Papers
Divergence in Post-Pandemic Earnings Growth: Evidence from Micro Data
Sophia Chen
and
Do Lee
We use a comprehensive employer-employee dataset to examine post-pandemic worker earnings in the US. Our findings reveal that earnings grew faster in counties that were less severely impacted at the onset of the pandemic. This divergence in growth was both substantial and persistent, particularly for lower-paid and nonmanagerial workers, as well as for those in smaller firms. Both wage increases and additional hours contributed to this earnings growth. This evidence aligns with a job-ladder framework, where labor market competition leads to a dispersion of earnings across counties but compresses earnings among workers in counties with strong labor markets. Our findings provide a microfoundation for the wage Phillips curve and have direct implications for stabilization policies.
Keywords:
Earnings; Wage; Labor Market Conditions; Pandemic; Earnings growth; micro data; labor market competition; IMF working paper No. 2024/222; employer-employee dataset; Wages; Labor markets; Labor force; Unemployment; North America; Global
Cover Selected Issues Papers
Causes and Implications of Elevated Inflation in Cyprus
Robert C. M. Beyer
Inflation has risen sharply in Cyprus, initially driven by imported prices, but increasingly broadening to domestic prices. A Phillips Curve estimate attributes the high inflation largely to energy prices, external price pressures, and inflation expectations at the end of 2022. Historically high pass-through of inflation shocks to wages—amplified by a tight labor market—may make inflation persistent. This calls for policies to stem inflationary pressures while protecting vulnerable households.
Keywords:
Cyprus; Inflation; Import Prices; Energy Prices; Phillips Curve; Wages; inflation expectation; C. inflation driver; inflation shock; E. inflation outlook; Phillips Curve estimate; Energy pricing; Oil prices; Income; Europe
Cover Selected Issues Papers
Fiscal Federalism in Belgium: Challenges in Restoring Fiscal Sustainability Belgium: Belgium
Yu Ching Wong
Fiscal decentralization in Belgium progressed substantially in 2015-19. However, as decentralization of expenditure responsibilities continued to outpace decentralization of revenue authority, vertical fiscal gaps and greater reliance on transfers from shared resources may have reduced spending discipline. Consecutive shocks (pandemic, energy prices) have worsened the fiscal positions of all levels of government, requiring urgent and concerted effort to improve fiscal and debt sustainability. Fostering better fiscal policy coordination across all levels of government would improve the efficiency of Belgium’s decentralized fiscal framework. We recommend that fiscal adjustment at the subnational levels should be a part of the general government fiscal consolidation plan, with strict spending limits applying; integrating systematic spending reviews in the budgetary process; and adopting a more strategic, multi-annual fiscal framework to support adjustment. Implementing the 2013 Cooperation Arrangement—intended to provide fiscal rules to govern and coordinate public finances at all levels—is important. Also, the cost of overborrowing at the regional level should be fully internalized; recalibration of transfers could be considered; and some flexibility should be retained in the pace and scope of further decentralization. Finally, there is scope to improve the integration of fiscal sustainability objectives in federal and subnational structural reforms.
Keywords:
fiscal policy; fiscal consolidation; taxation and revenue; budget; deficit; and debt; state and local governments; federal and subnational public finances; fiscal decentralization; federalism; decentralization of expenditure responsibility; community government; consolidation plan; Subnational government; Article IV Consultation Staff Report; Fiscal federalism; Fiscal stance; Global
Cover Departmental Papers
State-Owned Enterprises in Middle East, North Africa, and Central Asia: Size, Costs, and Challenges: Executive Summary
Mr. Ernesto Ramirez Rigo
,
Christine J. Richmond
,
Oluremi Akin Olugbade
,
Gareth Anderson
,
Maria Atamanchuk
,
Mr. Hatim Bukhari
,
Iacovos Ioannou
,
Deeksha Kale
,
Tannous Kass-Hanna
,
Mr. Maximilien Queyranne
,
Wei Shi
, and
Joyce Wong
Prior to the COVID-19 shock, the key challenge facing policymakers in the Middle East, North Africa, and Central Asia region was how to generate strong, sustainable, job-rich, inclusive growth. Post-COVID-19, this challenge has only grown given the additional reduction in fiscal space due to the crisis and the increased need to support the recovery. The sizable state-owned enterprise (SOE) footprint in the region, together with its cost to the government, call for revisiting the SOE sector to help open fiscal space and look for growth opportunities.
Keywords:
State-owned enterprises; corporate governance; fiscal risks; Middle East; Central Asia; COVID-19; SOE footprint; government support; SOE definition; SOE mandate; SOE sector; SOE governance; Public enterprises; Public sector; North Africa; Middle East and Central Asia; Global
Cover Departmental Papers
State-Owned Enterprises in Middle East, North Africa, and Central Asia: Size, Costs, and Challenges: Executive Summary
Mr. Ernesto Ramirez Rigo
,
Christine J. Richmond
,
Oluremi Akin Olugbade
,
Gareth Anderson
,
Maria Atamanchuk
,
Mr. Hatim Bukhari
,
Iacovos Ioannou
,
Deeksha Kale
,
Tannous Kass-Hanna
,
Mr. Maximilien Queyranne
,
Wei Shi
, and
Joyce Wong
Prior to the COVID-19 shock, the key challenge facing policymakers in the Middle East, North Africa, and Central Asia region was how to generate strong, sustainable, job-rich, inclusive growth. Post-COVID-19, this challenge has only grown given the additional reduction in fiscal space due to the crisis and the increased need to support the recovery. The sizable state-owned enterprise (SOE) footprint in the region, together with its cost to the government, call for revisiting the SOE sector to help open fiscal space and look for growth opportunities.
Keywords:
State-owned enterprises; corporate governance; fiscal risks; Middle East; Central Asia; COVID-19; SOE footprint; government support; SOE definition; SOE mandate; SOE sector; SOE governance; Public enterprises; Public sector; North Africa; Middle East and Central Asia; Global
Cover Departmental Papers
State-Owned Enterprises in Middle East, North Africa, and Central Asia: Size, Costs, and Challenges
Mr. Ernesto Ramirez Rigo
,
Christine J. Richmond
,
Oluremi Akin Olugbade
,
Gareth Anderson
,
Maria Atamanchuk
,
Mr. Hatim Bukhari
,
Iacovos Ioannou
,
Deeksha Kale
,
Tannous Kass-Hanna
,
Mr. Maximilien Queyranne
,
Wei Shi
, and
Joyce Wong
Prior to the COVID-19 shock, the key challenge facing policymakers in the Middle East, North Africa, and Central Asia region was how to generate strong, sustainable, job-rich, inclusive growth. Post-COVID-19, this challenge has only grown given the additional reduction in fiscal space due to the crisis and the increased need to support the recovery. The sizable state-owned enterprise (SOE) footprint in the region, together with its cost to the government, call for revisiting the SOE sector to help open fiscal space and look for growth opportunities.
Keywords:
State-owned enterprises; corporate governance; fiscal risks; Middle East; Central Asia; COVID-19; SOE footprint; government support; SOE definition; SOE mandate; SOE sector; SOE governance; Public enterprises; Public sector; North Africa; Middle East and Central Asia; Global
Cover IMF Working Papers
The Structural Determinants of the Labor Share in Europe
Dilyana Dimova
The labor share in Europe has been on a downward trend. This paper finds that the decline is concentrated in manufacture and among low- to mid-skilled workers. The shifting nature of employment away from full-time jobs and a rollback of employment protection, unemployment benefits and unemployment benefits have been the main contributors. Technology and globalization hurt sectors where jobs are routinizable but helped others that require specialized skills. High-skilled professionals gained labor share driven by productivity aided by flexible work environments, while low- and mid-skilled workers lost labor share owing to globalization and the erosion of labor market safety nets.
Keywords:
WP; skilled worker; import penetration; employment share; further labor share erosion; labor market; labor share erosion; labor share shrinkage; labor share stagnation; share data; share decline; wage share; labor share; technology; employment policies; globalization; shift share analysis; labor share contraction; labor share growth; labor share shrink; labor share stem; self-employment share; labor share come; labor share tend; labor share fluctuation; Employment; Employment protection; Unemployment benefits; Global; Baltics; Europe
Cover IMF Working Papers
Rightsizing Brazil’s Public-Sector Wage Bill
Ms. Izabela Karpowicz
and
Mauricio Soto
Brazil’s public-sector wage bill is comparatively high. It grows inertially and competes with other spending. Rightsizing the wage bill could stimulate administrative efficiency and bring more equity into a system where public employees earn more than private in comparable professions. Most importantly, however, a reform is necessary to comply with the Federal government expenditure ceiling and the subnational fiscal responsibility rules. A reform should thus encompass all government levels, and all careers, and should aim to achieve a real decrease in salaries and lower employment. In the medium term, a review of the compensation structure should rationalize the multitude if wage grids, merge allowances into the base wage, and align public sector compensation to private wages in low-skilled professions.
Keywords:
WP; pay; wage bill; government; bill growth; bill; private sector; employee compensation; public spending; fiscal rules; bill statistics; bill policy; bill rule; bill management; log-earnings specification; bill adjustment; Wages; Employment; Wage adjustments; Public sector wages; Government wage bill; Europe
Cover IMF Working Papers
An Application of Distribution-Neutral Fiscal Policy
Mr. Sanjeev Gupta
,
Sugata Marjit
, and
Sandip Sarkar
Distribution neutral fiscal policy refers to a structure of taxes and transfers that keep the income distribution unchanged even after positive or negative shocks to an economy. This is referred to as a Strong Pareto Superior (SPS) allocation which improves the standard Pareto criterion by keeping the degree of inequality, but not the absolute level of income intact. We apply this methodology to India to compute SPS tax rates and determine their proximity to actual tax rates. Limited available data on income and expenditure shows that the official policies so far are close to desired benchmark level. Our methodological contribution will be enriched further with more detailed income tax and transfer data.
Keywords:
WP; Lorenz curve; inequality measure; Strong Pareto Superiority; Inequality; Compensation mechanism; SPS allocation; income distribution; income quantile; salary income; Income inequality; Personal income; Income distribution; Estate tax