Fiscal Politics
Back Matter

Back Matter

Author(s):
Vitor Gaspar, Sanjeev Gupta, and Carlos Mulas-Granados
Published Date:
April 2017
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Index

  • Abed, G. T., 155

  • Accountability

    • FCs and, 401–7

    • for promise gaps, 34f 35–37, 36t, 39n21

  • Acemoglu, D., 154–55, 282

    • on inclusive politics, 243

  • Adjustment effort

    • in economic shocks, 352, 371

    • for fiscal noncompliance, 365, 365n20

  • Advanced economies

    • elections in, 13, 140

    • ER in, 301–3

    • exchange rates of, 271n2

    • fiscal consolidation in, 13, 27, 28t

    • forecasting in, 346

    • IMF and, 76n19

    • MTBF in, 314

    • optimistic forecasts in, 346

    • PBCs in, 7n13, 63

    • public debt in, 216–17, 217f, 218

    • public investment in, 123

    • tipping points in, 241

    • wage bill in, 149

  • Advisory Fiscal Board, of EU, 400

  • Aggregate demand

    • full employment and, 8

    • government spending and, 178

    • from public investment, 111

  • Aidt, T., 113n4

  • Aizenman, J., 178n3

  • Alesina, A., 26, 27, 47, 94, 94n5, 96, 288

    • CAPB and, 285

    • on FCs, 402

    • on PBCs, 327

    • in public debt, 216–17

    • on status quo changes, 244n1

  • ALLHOUSE, 184, 184n12

  • Allocation, 5

    • for public investment, 123n27

  • Alter, J., 185

  • AMECO, 446, 448

  • American Recovery and Reinvestment Act, 184–85

  • Anderson, T., 493–94

  • Andrews, M., 383n8

  • Angelopoulos, K., 97

  • Annual Government Finance Statistics, of EUROSTAT, 140n3

  • Ardagna, S., 94

    • CAPB and, 285

  • Arellano, M., 68, 119, 119n21, 487

    • FD-GMM of, 356, 361t–362t

  • Arezki, R., 262

  • Argentina

    • economic shocks and, 244n1

    • ER in, 305, 306

  • Argimón, L., 364

  • Armingeon, K., 181

  • Articles of Confederation, 429–30, 436

  • Arze del Granado, F. J., 153n3

  • Auerbach, A. J., 44

  • Auriol, E., 485n10

  • Australia

    • ER in, 306

    • promise gaps in, 49

    • taxes in, 84n1

  • Austria

    • promise gaps in, 49–50

    • SCM in, 291, 292f

  • Autocratic regimes, Great Recession and, 179–80

  • Autonomous Communities, in Spain, 347

  • Baerg, N., 101

  • Bagehot, W., 435

  • Bailouts

    • of banks, 181n6

    • by CGs, 166, 351–52, 351n9

    • defined, 349n7

    • for fiscal noncompliance, 350, 350n5

    • overspending incentives and, 350, 351–52

    • for SNGs, 349n7

    • of SOEs, 166

    • See also No-bailout clause

  • Balanced budget rules (BBR), 100, 100n13, 104n18, 404–5

    • endogeneity and, 73

    • ER and, 301

    • rational voters and, 406

    • taxes and, 102t

  • Balance of payments

    • IMF and, 480n5

    • of LICs, 75n18

  • Banks

    • bailouts for, 181n6

    • crises of, taxes and, 95–96, 96n8

    • See also Central banks

  • Baqir, R., 155n6

  • Bartels, L., 179

  • Basinger, S., 98

  • BBR. See Balanced budget rules

  • Beck, N., 43

  • Beck, T., 500

  • Beetsma, R., 405n4, 407n7

  • Belgium

    • budget forecasts in, 420, 420/

    • debt sustainability in, 50

    • ER in, 303, 306, 308

    • FCs in, 413, 418–22, 420f–422f

    • HCF in, 413, 418–22, 420f–422f

    • media in, 420–21, 421 f

    • promise gaps in, 50

    • public debt in, 419

    • SCM in, 291, 292f

  • Besley, T., 3–4, 3n3, 241

  • Bias

    • fiscal, 404–5

    • overfitting, 68

    • selection, 64–65, 486–87

    • See also Deficit bias

  • Biglaiser, G., 96

  • Bird, G., 486n12

  • Blackstone, William, 431

  • Blanchard, O., 181

  • Blinder, A. S., 181

  • Block, S. A., 64, 64n3

  • Blundell, R., 68, 119, 119n21

    • GMM of, 486n11

  • Bogaert, H., 452–53

  • Bohn, H., 311

  • Bond, S., 68, 119, 119n21, 356, 486n11, 487

  • Bonds

    • in EU, 443–44

    • in U.S., 17, 429

  • Bonfatti, Andrea, 15–16

  • Bordo, M., 271n2

  • Botswana, ER in, 309

  • Bover, O., 68, 119, 119n21

  • Brady, D., 244

  • Braendle, T., 11n20

  • Braütigam, D., 245

  • Brazil

    • economic shocks and, 244n1

    • ER in, 305

  • Brender, A., 63n1, 125, 127, 137n1

  • Brollo, F., 328

  • Brück, T., 197

  • Brückner, M., 99

  • Brun, J., 480

  • BSL. See Budget Stability Law

  • Buchanan, J. M., 5

  • Budget cycles

    • in LICs, 64–65, 68–69, 69t

    • proximity factor and, 6, 7n13

  • Budget deficits. See Deficits

  • Budget forecasts

    • in Belgium, 420, 420f

    • FCs and, 416

    • intergovernmental fiscal arrangements and, 388

    • of minority governments, 197

    • in Netherlands, 416, 416f

  • Budget institutions, 16

    • for credible fiscal policymaking, 378–81

    • defined, 377n2

    • evaluation of, 382–91, 383f, 383n8, 384f

    • fiscal outlook and, 385, 386f, 387f, 396

    • fiscal strategy in, 380–82, 386f–387f, 388–91, 389f–390f 392f–393f 396–97

    • in LICs, 377–97

    • in parliamentary systems, 381

    • strengthening, 394–97

  • Budget Law of 2003, in Italy, 330n4

  • Budget rules, 114

    • government spending and, 118

    • See also Balanced budget rules

  • Budget Stability Law (BSL), in Spain, 353–55, 355n13

  • Bulgaria, ER in, 306

  • Bulir, A., 480

  • Bureau for Economic Analysis, in Netherlands, 413, 414–18

  • Business cycles. See Political business cycles

  • CAB. See Cyclically adjusted budget balance

  • Cabezón, E., 378

  • Cabinet ideology

    • fiscal politics and, 7–9

    • public investment and, 13n21

    • redistribution and, 8

  • Cahuc, P., 137n1, 139

  • Calmfors, L., 401, 413

  • Calvo, E., 99n10

  • Canada

    • decentralization in, 30n8

    • ER in, 306, 308

    • promise gaps in, 50–51

  • CAPB. See Cyclically adjusted primary balance

  • Capello, D., 98

  • Capitalism, Socialism and Democracy (Schumpeter), 3

  • Capital spending

    • elections and, 332, 332f

    • fiscal rules and, 330

    • in Italy, 331–32, 331n7, 332f, 336f

    • outsourcing of, 331n7

    • PBCs and, 16, 331

    • public investment and, 130, 130t

    • wage bill and, 139

  • Caporale, G. M., 442

  • Carcillo, S., 137n1, 139

  • Caro, L., 97

  • Cassidy, T., 327

  • CDS. See Credit default swaps

  • Cecchetti, S. G., 181

  • Center for Systemic Peace, 162

  • Central African and Economic Monetary Community, fiscal rules in, 73n15

  • Central banks

    • exchange rates by, 275–77, 276n10

    • Great Recession and, 194, 194n26

    • independence of, 404n5

  • Central governments (CGs)

    • bailouts by, 166, 351–52, 351

    • n9

    • DSP and, 328

    • ER of, 256

    • fiscal noncompliance and, 353, 353n12

    • government spending by, 114n8

    • macroeconomic forecasting for, 373

    • MTBF and, 380

    • SNGs and, 345

    • soft budget constraints for, 345

    • VAT and, 256

  • Centralization, 6, 437

    • of EA, 468–69

    • inclusive politics and, 243–44

    • in LICs, 394

    • of taxes, 256

  • Central Planning Bureau (CPB), in Netherlands, 414–18, 417f, 418f

  • CEPII, 168

  • CGs. See Central governments

  • Chambas, G., 480

  • Checks and balances, 250

    • from DPI, 218

    • in PBCs, 7n13, 192n22

    • for public debt, 224

    • veto players and, 218

  • Cheibub, J. A., 184n10, 202

  • Chernow, Ron, 431

  • China

    • contract responsibility system in, 255–56

    • SAT in, 256–57

    • SOEs in, 242, 255–56

    • taxes in, 254–57, 258f

    • tax-to-GDP ratio in, 256, 257

    • tax-to-GDP threshold of, 242

    • VAT in, 256, 257

  • Cho, H., 480

  • Choi, I., 488

  • Cioffi, M., 327

  • CIT. See Corporate income taxes

  • Clements, B., 153, 161, 162, 163

  • Coady, D., 153n3

  • Coalition governments

    • ER in, 300, 303, 305, 311

    • Great Recession and, 198

    • in Netherlands, 415–16

  • Cobb-Douglas specification, 157

  • Coelho, C., 328

  • Cohesion. See Political cohesion

  • Collier, P., 262

  • Colombia

    • GDP per capita in, 260, 261 f

    • taxes in, 259–60, 261f

    • tax-to-GDP threshold of, 242

    • VAT in, 259–60

  • Combes, J.-L., 72

  • Commission on Growth and Development Report, 244

  • Common pool, 9, 14

    • corruption and, 223

    • in EA, 441

    • in EU, 443–44

    • government spending and, 441n1

    • legislative periods and, 221t

    • overspending incentives and, 352

    • political fragmentation and, 214, 217–18, 222, 230t

    • public debt and, 214, 222, 223t, 230t

    • sanctions and, 465n25

    • taxes and, 215, 441n1

  • Compliance. See Fiscal noncompliance

  • Conditionality

    • endogeneity and, 486

    • fiscal noncompliance and, 484

    • GMM for, 486, 486n11, 487–88

    • of IMF, 477–501, 478f, 479t, 483f, 484f, 489t, 491t–493t, 496t, 498t, 501t

    • robustness tests for, 480, 494–98

    • selection bias and, 486–87

    • for taxes, 477–501, 478f, 479t, 480n5, 483f, 484f, 489t, 491t–493t, 496t, 498t, 501t

    • tax-to-GDP ratio and, 496

    • trade openness and, 485

  • Consiglio comunale (municipal council), 329

  • Consolidation promise gaps. See Promise gaps

  • Constitutive institutions, 243

  • Consumption multiplier, with wage bill, 139

  • Continental certificates, 429

  • Continental financial system

    • in EU, 435–38

    • in U.S., 427–35

  • Contract responsibility system, in China, 255–56

  • Control of parliament

    • political cohesion and, 280

    • in political fragmentation, 217

    • public debt and, 223

  • Conway, P., 486n12

  • Cordes, Till, 15

  • Corporate income taxes (CIT)

    • conditionality and, 481 f, 485

    • in EU, 105

    • in left-wing governments, 98

    • in OECD, 83, 84n1, 85, 86–88, 86f–87f 103, 104n19

    • in right-wing governments, 98

    • tax competition for, 103

  • Correa-Caro, Carolina, 14

  • Corruption

    • common pool and, 223

    • DPI and, 123n25

    • guide, of ICRG, 220, 500

    • index, of Transparency International, 485–86

    • political fragmentation and, 223

    • public debt and, 223, 224t, 232t

    • public social spending and, 158

    • tax tipping points and, 248f

    • World Bank and, 223

  • Council of the European Union, 442

  • Country size, fiscal rules and, 458–62, 459t, 460f, 4611

  • Covariance matrix, for PCA, 36n18

  • Cowen, David, 431, 435

  • CPB. See Central Planning Bureau

  • CPFF. See Ministry of Finance to the Economic and Financial Council

  • Cragg, J., 487–88

  • Credible leadership, 244

  • Credit default swaps (CDS), 411 f

  • Crisis mode, for taxes, 95–97, 103–4

  • The Crisis of the Tax State (Schumpeter), 3n2, 241

  • Crivelli, Ernesto, 14, 17

  • Crowding-out effect

    • for energy subsidies, 154, 164, 166, 169, 171

    • on public social spending, 154

    • right-wing governments and, 8

  • Crowe, C., 194

  • Cruz, C., 98

  • Cukierman, A., 194, 406n6

  • Currency unions, 274n8

  • Curristine, Teresa, 16, 407

    • on FCs, 401

  • Cyclically adjusted budget balance (CAB), FCs and, 408–9, 411–12, 413t

  • Cyclically adjusted primary balance (CAPB), 27, 27n4

    • exchange rates and, 285, 285n22

  • Dabla-Norris, E., 378

  • Database of Political Institutions (DPI), 98, 99, 99n11, 116, 118n17, 487, 500

    • checks and balances from, 218

    • corruption indicators in, 123n25

    • on political fragmentation, 217

    • on public debt, 216

  • Debrun, Xavier, 16, 328

    • on FCs, 405n4, 407n7

    • on Fiscal Council Dataset, 228n17

  • Debt. See Public debt

  • Debt rules (DR)

    • in BSL, 354

    • in emerging economies, 301, 307

    • fiscal noncompliance with, 307

    • in LICs, 64n4, 73n17

  • Debt-to-GDP ratio, 117, 119, 185

    • deficits and, 213

    • in EA, 448, 457f

    • in EU, 436

    • political fragmentation and, 226

  • Debt-to-GDP threshold, 226, 226n16

  • Debus, M., 97

  • Decentralization

    • in Canada, 30n8

    • in EA, 467

    • in Spain, 30n8, 347, 367n21

    • of taxes, 367n21

  • Deficit bias

    • asymmetric response to, 451, 451t

    • characterization of, 403–4

    • defined, 403n2

    • in EA, 450–52, 4511, 470t, 472t, 473t

    • elections and, 402–7

    • FCs for, 401, 405–7

    • government spending and, 126

    • incumbents and, 402, 406

    • partisanship and, 402

    • procyclicality and, 450–52

  • Deficit ceiling

    • in EA, 455

    • GDP and, 354

    • in Netherlands, 415–16, 416f

  • Deficit of legitimacy, of EU, 445

  • Deficits, 8n16

    • debt-to-GDP ratio and, 213

    • EDP and, 454, 458–62, 459t, 460f, 461t

    • ER and, 299–300

    • in EU, 101

    • fiscal noncompliance and, 358–59, 358f, 359f, 366f, 368f

    • in Great Recession, 182

    • minority governments and, 197

    • PBCs and, 112

    • political fragmentation and, 229

    • quantitative limits for, 400

    • SNGs and, 345

    • in Spain, 356n17

  • De Gramont, D., 263, 264

  • De Haan, J., 7n13, 9, 137n1

    • on budget institutions, 378

    • on central banks, 194n26

    • on political fragmentation, 198

  • Delgado-Téllez, Mar, 16

  • Democracy

    • of EU, 445

    • government spending and, 155n6

    • in Great Recession, 179–80

    • PBCs and, 7n13

    • public investment in, 111–32

    • See also Parliamentary systems; Presidential systems

  • Democratic Party, American Recovery and Reinvestment Act and, 184–85

  • Demographics, wage bill and, 141t–142t, 142, 145

  • Deng Xiaoping, 255

  • Denmark

    • ER in, 306, 310

    • promise gaps in, 51

    • taxes in, 84n1

  • DeRouen, K., 96

  • Detken, C., 443

  • Developing economies

    • exchange rates of, 271n2

    • public debt in, 216–17, 217f

    • tipping points in, 241

  • Devereux, M., 84

  • Devries, P., 26, 27, 27n5, 39, 47

  • Difference-in Hansen test, 487

  • Directorate General for Economic and Financial Affairs, of EC, 446

  • Direct taxes, in LICs, 67n9

  • Distribution, 5

  • Dobbins, J., 244

  • Domestic Stability Pact (DSP)

    • CGs and, 328

    • in Italy, 327–40, 333f, 334f

    • PBCs and, 333

  • Donald, S., 487–88

  • Downs, A., 3, 7n13

  • DPI. See Database of Political Institutions

  • DR. See Debt rules Draghi, Mario, 437

  • Drazen, A., 63n1, 96, 112, 113n4, 125, 127, 137n1, 328

    • on status quo changes, 244n1

    • on wage bill, 139

  • Dreher, A., 76n20, 96–97

    • on central banks, 194n26

    • on conditionality, 500

  • Driscoll, J., 119, 282, 285

  • DSP. See Domestic Stability Pact

  • Duttagupta, R., 274n8

  • EA. See Euro area Easterly, W., 217n5

  • Ebeke, Christian, 12–14, 72, 127

  • EC. See European Commission

  • ECB. See European Central Bank

  • ECF. See Extended Credit Facility

  • Eckhardt, S., 137n1, 139

  • Economic and Financial Affairs Council (ECOFIN), 444, 445, 462, 469

  • Economic and Monetary Union (EMU), 17

    • fiscal rules of, 85, 454–55

    • Great Recession and, 465

  • Economic shocks

    • adjustment effort in, 352, 371

    • automatic stabilizers of, 10

    • bank bailouts for, 181n6

    • fiscal noncompliance and, 352–53, 360, 364, 364f

    • reforms in, 244n1

    • stimulus packages for, 180

    • taxes and, 96–97

    • See also Great Recession

  • Economides, G., 97

  • Edin, P.-A., 197, 198

  • EDP. See Excessive deficit procedure

  • EEC. See European Economic Community

  • EFF. See Extended Fund Facility

  • Ehrhart, H., 67, 70

  • Elections

    • adjustments after, 64

    • in advanced economies, 13, 140

    • capital spending and, 332, 332f

    • country characteristics of, 123, 124t

    • deficit bias and, 402–7

    • descriptive statistics for, 129t

    • in EA, 99

    • in emerging economies, 140

    • endogeneity for, 71–72, 72t, 125–26

    • ER and, 301, 312

    • fiscal noncompliance and, 369–71, 370f

    • fixed-term, 125, 125n29

    • government spending and, 13, 66n7, 111, 130n34

    • in Italy, 331

    • in LICs, 63–78, 79t

    • monetary policy and, 137n2

    • non-endogenous, 125, 125n28

    • PBCs and, 113n3, 214–15

    • political horizon and, 280

    • in presidential systems, 64, 64n3

    • promise gap and, 25, 25n2

    • public investment and, 111–12, 112n1, 113n4, 117–23, 120t–121t, 122f, 123n27

    • scrutiny of, 72–77

    • selection bias in, 64–65

    • wage bill and, 13, 137–51, 146t, 147t, 148t

    • See also Incumbents

  • Electoral College, 127

  • Electoral proximity. See Proximity factor

  • Elites

    • energy subsidies and, 154, 154n5, 155–56, 159–61

    • imperfect information of, 154

    • middle class and, 14

    • public social spending and, 154

    • taxes and, 15

  • Emerging economies

    • DR in, 301, 307

    • elections in, 140

    • ER in, 314

    • IMF and, 76n19

    • public debt in, 216, 217f

    • taxes in, 70

    • wage bill in, 13, 149

  • EMU. See Economic and Monetary Union

  • Endegnanew, Yehenew, 13

  • Endogeneity

    • BBR and, 73

    • conditionality and, 486

    • for elections, 71–72, 72t, 125–26

    • for energy subsidies, 167–69

    • for exchange rates, 285

    • GMM and, 452

    • OG and, 449

    • reverse causality and, 449

  • Energy subsidies, 13–14, 153–72

    • changes across regions for, 163f

    • countries in study for, 172t

    • by country, 164f

    • cross-sectional specification for, 166–67

    • crowding-out effect for, 154, 164, 166, 169, 171

    • econometric analysis for, 165–66

    • elites and, 154, 154n5, 155–56, 159–61

    • empirical analysis of, 161–71

    • endogeneity for, 167–69

    • energy demand and, 157n13

    • fragility index for, 162–63

    • GDP and, 153, 154, 163, 167, 168

    • IMF on, 154n4

    • intensity around globe, 173f

    • in MENA, 164, 174f

    • middle class and, 154, 156

    • political effectiveness and, 166, 169, 170t

    • price gap for, 161

    • SOEs and, 166

    • synthetic index of governance for, 162

    • taxes and, 160

    • utility function and, 156n8

    • VAT and, 155

    • welfare effect of, 153n3

  • EP. See European Parliament

  • ER. See Expenditure rules

  • Escolano, J., 32, 32n9

    • on public debt, 213n1

  • Eskelund, G., 352

  • Eslava, M., 112, 113n4, 328

    • on wage bill, 139

  • Estonia, taxes in, 84n1

  • EU. See European Union

  • Euler equation, 403

  • Euro area (EA)

    • centralization of, 468–69

    • common pool in, 441

    • debt-to-GDP ratio in, 448, 457f

    • decentralization in, 467

    • deficit bias in, 450–52, 451t, 470t, 472t, 473t

    • deficit ceiling in, 455

    • EDP in, 454, 458–62, 459t, 460f, 461t

    • elections in, 99

    • fiscal consolidation in, 445

    • fiscal discipline in, 465

    • fiscal noncompliance in, 454–58, 455 f,

    • 456f, 457f

    • fiscal politics in, 439–69

    • fiscal rules in, 17, 439, 454–58

    • GDP in, 458

    • government spending in, 452, 453f

    • no-bailout clause of, 466

    • OG in, 447–48, 447f

    • past reforms in, 462–64

    • policy biases in, 440–46

    • procyclicality in, 450–52, 451n15, 470t–471t, 473t

    • public investment in, 441, 452–54

    • sanctions in, 464–65

    • supranational fiscal policy in, 439

    • taxes in, 441–42, 452–54

    • VAT in, 85

  • European Central Bank (ECB), 437

    • monetary policy and, 442n3

    • Outright Monetary transactions Program of, 427

  • European Commission (EC), 463–64

    • Directorate General for Economic and Financial Affairs of, 446

    • fiscal rules of, 367–68, 444

    • Great Recession and, 445

    • reverse qualified majority rule for, 464

    • SCPs of, 27, 47, 101, 353, 408–9

    • Stability and Convergence Program of, 27, 47, 101, 353

  • European Economic Community (EEC), 251

  • European Parliament (EP), 442

    • ordinary legislative procedure of, 442n2

  • European Safe Bonds, 17

  • European Semester, 444

  • European Stability Mechanism, 467

  • European Union (EU)

    • Advisory Fiscal Board of, 400

    • bonds in, 443–44

    • CIT in, 105

    • common pool in, 443–44

    • Continental financial system in, 435–38

    • debt-to-GDP ratio in, 436

    • deficit of legitimacy of, 445

    • deficits in, 101

    • democracies of, 445

    • ER in, 305–6

    • FCs of, 409, 410f, 411f

    • fiscal rules in, 11n20, 73n15, 85, 444–45

    • fixed exchange rates in, 290–93, 290n27, 292f

    • PIT in, 105

    • Six Pack in, 100, 105

    • taxes in, 100–101, 105, 442

    • Two Pack in, 100, 105

    • VAT in, 83, 100, 105

    • See also Stability and Growth Pact

  • EUROSTAT, Annual Government Finance Statistics of, 140n3

  • Excessive deficit procedure (EDP), 454, 458–62, 459t, 460f, 461t

  • Exchange rates

    • of advanced economies, 271n2

    • CAPB and, 285, 285n22

    • by central banks, 275–77, 276n10

    • of developing economies, 271n2

    • dynamic approach to, 274

    • empirical analysis and data for, 279–85, 280t

    • endogeneity for, 285

    • fiscal discipline with, 15, 271–96

    • MCD for, 280n16

    • outliers for, 285

    • PCA for, 280n16

    • political cohesion for, 272, 274–75, 277–88, 279f

    • political horizon for, 273–85, 278f, 288

    • public debt and, 277–78

    • robustness tests for, 285–90, 286t, 287t, 288n24, 289t, 290t

    • sensitivity of, 285–90, 286t

    • traditional argument for, 273

    • See also Fixed exchange rates; Flexible exchange rates

  • Executive committee (giunta comunale), 329

  • Executive polarization, in political fragmentation, 217–18

  • Expenditure rules (ER), 15, 299–317

    • adoption and abandonment of, 305–6, 305f

    • in advanced economies, 301–3

    • in Australia, 306

    • BBR and, 301

    • in BSL, 354

    • of CGs, 256

    • in coalition governments, 300, 303, 305, 311

    • compliance with, 306, 307–11, 308f–310f

    • deficits and, 299–300

    • design features of, 304f

    • details by country, 319t–323t

    • elections and, 301, 312

    • in emerging economies, 314

    • GDP and, 309

    • government size and, 314–16, 315 f, 316f

    • for government spending, 300

    • Great Recession and, 306

    • index of, 312, 312n10

    • inflation and, 309

    • long-term sustainability and, 311–13, 312t, 313f

    • macroeconomic forecasting and, 299

    • in minority governments, 306

    • MTBF and, 316, 316f

    • panel regression analysis for, 318t

    • PBCs and, 300, 301

    • public investment and, 300, 313–14, 314f

    • reverse causality for, 311n9

    • types and design features of, 301–5, 302f, 304f

  • Extended Credit Facility (ECF), 494n23

  • Extended Fund Facility (EFF), 494n23

  • Eyraud, Luc, 17, 367

  • Falcó-Gimeno, A., 197

  • Fashola, Babatunde, 262–63

  • Fatás, A., 155, 272, 282

  • Favero, C., 94n5

  • Faye, M., 72

  • FCL. See Flexible Credit Line

  • FCs. See Fiscal councils

  • FD-GMM. See First-difference generalized method of moments

  • Federalist 30, 430

  • Federal Reserve, in U.S., 180

  • Fernández-Leiceaga, X., 347, 364

  • 15-month forecast error, promise gaps and, 33f

  • Filc, G., 378

  • Financial markets

    • fiscal discipline of, 26

    • fiscal noncompliance and, 368–69, 369f

  • Finland

    • ER in, 303, 306, 309

    • promise gaps in, 52

  • First-difference generalized method of moments (FD-GMM), 356, 361t–362t

  • Fiscal autonomy, fiscal noncompliance and, 352, 366–71, 368f

  • Fiscal balance, in LICs, 70–71, 70n12

  • Fiscal balance ceilings, MTOs and, 446n8, 450n13

  • Fiscal bias, fiscal rules for, 404–5

  • Fiscal centralization. See Centralization Fiscal Compact, MTOs and, 463

  • Fiscal consolidation

    • absolute frequency of, 28f

    • in advanced economies, 13, 27, 28t

    • debt sustainability and, 50, 85

    • in EA, 445

    • fiscal discipline and, 49

    • fiscal stress and, 32

    • GMM and, 452

    • in Great Recession, 473t

    • procyclicality and, 450

    • relative frequency of, 29f

    • taxes and, 94–95, 94n5, 94n6

  • Fiscal Council Dataset, of IMF, 228, 228n17

  • Fiscal councils (FCs), 11–12, 14–15, 16

    • accountability factor and, 401–7

    • in Belgium, 413, 418–22, 420f–422f

    • budget forecasts and, 416

    • budget process and, 413–22

    • CAB and, 408–9, 411–12, 413t

    • CDS and, 411 f

    • for deficit bias, 401, 405–7

    • effectiveness of, 401

    • ER of, 304

    • of EU, 409, 410f, 411f

    • fiscal discipline from, 11

    • fiscal rules and, 228n18, 406n4

    • forecast errors and, 411

    • Great Recession and, 399

    • media and, 16, 407–13, 412t

    • in Netherlands, 414–18

    • OG and, 409

    • political fragmentation and, 228

    • public debate and, 407–22

    • public debt and, 235t, 236t, 409

    • strength of, 235t

    • testable hypotheses for, 409

    • weakness of, 236t

  • Fiscal crises. See Economic shocks; Great Recession

  • Fiscal decentralization. See Decentralization

  • Fiscal deficits. See Deficits Fiscal discipline

    • in EA, 465

    • with exchange rates, 15, 271–96

    • from FCs, 11

    • of financial markets, 26

    • fiscal consolidation and, 49

    • from fiscal institutions, 11

    • fixed exchange rates and, 273

    • political strength and, 35

    • robustness tests of, 294t

  • Fiscal horizon, primary balance and, 283

  • Fiscal institutions

    • fiscal discipline from, 11

    • fiscal rules for, 400

    • political fragmentation and, 228

  • Fiscal noncompliance, 16

    • adjustment effort for, 365, 365n20

    • bailouts for, 350, 350n5

    • CGs and, 353, 353n12

    • conditionality and, 484

    • deficits and, 358–59, 358f, 359f, 366f, 368f

    • defined, 348

    • with DR, 307

    • in EA, 454–58, 455 f, 456f, 457f

    • economic shocks and, 352–53, 360, 364, 364f

    • elections and, 369–71, 370f

    • FD-GMM for, 356, 361t–362t

    • financial markets and, 368–69, 369f

    • fiscal autonomy and, 352, 366–71, 368f

    • fiscal stress and, 352–53

    • forecast errors and, 352–53, 353n11, 360, 360f, 360n18

    • gap-filling transfers for, 365–66

    • GDP and, 356, 356n16

    • GMM for, 356, 361t–362t, 368

    • inertial patterns for, 361t–363t, 364, 365f

    • intergovernmental fiscal arrangements and, 16, 350, 352, 372

    • no-bailout clause and, 349

    • overspending and, 350

    • problem of, 348–49, 349f

    • reverse causality for, 368n25

    • soft budget constraints and, 349–50, 350f

    • in Spain, 345–73, 373t, 374t

    • taxes and, 366–67

    • testable hypotheses for, 357, 357t

    • two-stage least square estimates of, 363t

  • Fiscal outlook, budget institutions and, 385, 386f, 387f, 396

  • Fiscal politics

    • cabinet ideology and, 7–9

    • in EA, 439–69

    • effects in, 5–10

    • influences on, 10–12

    • political fragmentation and, 9–10, 9n17

    • proximity factor and, 6–7

  • Fiscal reporting, 11, 379–80, 385

  • Fiscal risk management, 380, 385

  • Fiscal rules, 10–15

    • capital spending and, 330

    • country size and, 458–62, 459t, 460f, 461t

    • in EA, 17, 439, 454–58

    • of EC, 367–68, 444

    • of EMU, 85

    • of EU, 11n20, 73n15, 85, 444–45

    • FCs and, 228n18, 406n4

    • for fiscal bias, 404–5

    • for fiscal institutions, 400

    • in Italy, 327–40, 330t, 3411

    • for LICs, 64, 64n4, 73–75, 73n15, 73n16, 74t, 77n22

    • numerical fiscal limits in, 346 n4

    • in OECD, 100

    • for PBCs, 7n13, 327–40

    • political fragmentation and, 228n18

    • by SNGs, 15–16

    • for structural balances, 100

    • for taxes, 104

    • See also Balanced budget rules; Budget rules; Debt rules; Expenditure rules; Fiscal noncompliance

  • Fiscal space

    • in Great Recession, 178, 178n3, 185

    • in Italy, 331

  • Fiscal strategy, in budget institutions, 380–82, 386f–387f, 388–91, 389f–399f, 392f–393f, 396–97

  • Fiscal stress

    • fiscal consolidation and, 32

    • fiscal noncompliance and, 352–53

  • Fiscal watchdogs. See Fiscal councils

  • Fisher-type test, 488

  • Fiva, J. H., 112n1

  • Fixed exchange rates, 272–73

    • baselines for, 283, 283t

    • in EU, 290–93, 290n27, 292f

    • fiscal discipline and, 273

    • interaction terms for, 284, 284t

    • political cohesion for, 281 f

    • political horizon for, 281 f

  • Fixed-term elections, 125, 125n29

  • Fjeldstad, O.-H., 245

  • Flexible Credit Line (FCL), 494n23

  • Flexible exchange rates, 272–73, 274n7

    • political cohesion for, 281 f

    • political horizon for, 281 f

  • Forecast errors

    • by country, 415 f

    • FCs and, 411

    • 15-month, promise gaps and, 33f

    • fiscal noncompliance and, 352–53, 353n11, 360, 360f, 360n18

    • in Netherlands, 415

    • promise gaps and, 32

  • Forecasting, 380, 385

    • in advanced economies, 346

    • soft budget constraints and, 346

    • See also Budget forecasts; Macroeconomic forecasting

  • Foremny, D., 328

  • Forni, Lorenzo, 15–16

  • Fragility index, for energy subsidies, 162–63

  • France, promise gaps in, 52

  • Franco, Francisco, 251

  • Fritz, V., 243

  • Fuentes Quintana, Enrique, 251

  • Full employment, aggregate demand and, 8

  • G20, 195

    • Great Recession and, 383n9

  • Gagliarducci, S., 327, 339

  • Gali, J., 185

  • Game theory, 198

  • Gap-filling transfers, for fiscal

    • noncompliance, 365–66

  • Garber, Peter, 433–34

  • Gaspar, Vitor, 14–15, 14n22, 16–17, 443

    • on public debt, 213n1

    • on tax tipping points, 246

  • Gavin, M., 271–72

  • Gaviria, Cesar, 259

  • GDP

    • debt-to-GDP threshold, 226, 226n16

    • deficit ceiling and, 354

    • deficit-to-GDP ratio, 185

    • in EA, 458

    • energy subsidies and, 153, 154, 163, 167, 168

    • ER and, 309

    • fiscal noncompliance and, 356, 356n16

    • government spending and, 116n13

    • Great Recession and, 178

    • in Netherlands, 415

    • PFA and, 29

    • primary balances and, 30

    • procyclicality and, 147

    • promise gaps in, 26, 40

    • public debt and, 216, 222, 223

    • public investment and, 122

    • RFA and, 29

    • structural balances and, 30

    • taxes and, 482

    • tax tipping points and, 246, 246f, 247f

    • trade openness and, 500

    • VAT and, 103

    • wage bill and, 140, 144f, 145, 146–47,

    • 149t

    • World Economic Outlook on, 32n11

    • See also Debt-to-GDP ratio; Tax-to-GDP

  • GDP growth rate

    • in LICs, 66

    • taxes and, 93

    • wage bill and, 142, 147

  • GDP per capita

    • budget institutions and, 383

    • in Colombia, 260, 261 f

    • in Nigeria, 262

    • in OECD, 223n14

    • in Spain, 253, 253f

    • taxes and, 247

    • tax-to-GDP threshold and, 246, 246f

    • tipping points and, 241

  • Gehlbach, S., 84–85, 99n10

  • Generalized method of moments (GMM)

    • for conditionality, 486, 486n11, 487–88

    • endogeneity and, 452

    • FD-GMM, 356, 361t–362t fiscal consolidation and, 452

    • for fiscal noncompliance, 356, 361t–362t, 368

    • for OG, 449, 449n11

    • for public investment, 118–19, 119n21

    • system-GMM estimator, 68, 486–87, 486n11, 492, 494n21

  • Gérard, Marc, 16

  • Germany, promise gaps in, 52

  • GFS. See Government Finance Statistics

  • Giavazzi, F., 94n5

  • Gillingham, R., 153n3

  • Gini coefficient, IRFs and, 44

  • Girardi, A., 442

  • Giunta comunale (executive committee), 329

  • Global financial crisis. See Great Recession

  • Globalization

    • Great Recession and, 186

    • stimulus packages and, 191

  • GMM. See Generalized method of moments

  • Goderis, B., 262

  • Gollwitzer, S., 378

  • Golosov, G., 9n 17

  • Gordon, J., 245

  • Gorodnichenko, Y., 44, 193

  • Government

    • lending rate of, Great Recession and, 194

    • popularity of, promise gaps and, 40, 40n23, 41f–42f

    • size of, ER and, 314–16, 315f, 316f

  • See also Central governments; Coalition governments; Intergovernmental fiscal arrangements; Left-wing governments; Minority governments; Right-wing governments; Subnational governments

  • Government debt. See Public debt

  • Government Finance Statistics (GFS), of IMF, 140n3, 481

  • Government spending

    • aggregate demand and, 178

    • budget rules and, 118

    • by CGs, 114n8

    • common pool and, 441n1

    • deficit bias and, 126

    • democracies and, 155n6

    • in EA, 452, 453f

    • elections and, 13, 66n7, 111, 130n34

    • ER for, 300

    • fiscal rules for, 100

    • GDP and, 116n13

    • growth rate of, 116f

    • of left-wing governments, 113

    • OG and, 185

    • partisanship and, 113, 113n5

    • political fragmentation and, 229

    • public debt and, 217n5

    • public investment and, 130, 130t

    • quantitative limits for, 400

    • in Spain, 367n22

    • wage bill in, 137

    • See also Capital spending; Overspending; Public social spending

  • Granger, C. W. J., 45

  • Great Recession (global financial crisis)

    • autocratic regimes and, 179–80

    • central banks and, 194, 194n26

    • coalition governments and, 198

    • deficits in, 182

    • democracies in, 179–80

    • EC and, 445

    • EMU and, 465

    • ER and, 306

    • FCs and, 399

    • fiscal consolidation in, 473t

    • fiscal space in, 178, 178n3, 185

    • G20 and, 383n9

    • GDP and, 178

    • globalization and, 186

    • government lending rate and, 194

    • IMF and, 195

    • incumbents and, 179

    • international policy and, 195

    • left-wing governments in, 197

    • minority governments in, 197

    • monetary policy and, 193–94

    • OECD and, 182

    • outliers and, 202

    • parliamentary systems in, 197

    • PBCs and, 198–200

    • political constraints in, 177–202, 201 t, 203t–207t

    • political fragmentation in, 14, 198

    • presidential systems in, 197

    • stimulus packages for, 179–97, 183t, 187t–189t, 190f, 200, 202

    • in U.S., 184–85

  • Grembi, V., 327, 328, 331, 333

  • Griffith, R., 84

  • Grigoli, F., 315n14

  • Grilli, V., 9

  • Grotius, Hugo, 431

  • Gujarati, D., 485n10

  • Gunzinger, Fabian, 14

  • Gupta, Sanjeev, 12, 13, 13n21, 14, 16, 17

    • on energy subsidies, 155, 161, 162, 163

  • Gylfason, T., 262

  • Hallerberg, Mark, 13, 96, 99, 101

    • on budget institutions, 378

    • on ER, 300

  • Hamilton, Alexander, 17, 428–38

  • Hansen statistic, 487, 487n14

  • Hardin, G., 9n17

  • Harmonized Government Wage and Employment Data, of IMF, 140

  • Harris, Jason, 16, 407

    • on FCs, 401

  • Haver Analytics, 114

  • HCF. See High Council of Finance

  • Heavily Indebted Poor Countries (HIPC), 217n6, 223

  • Hendry, D., 44

  • Henisz, W. J., 184n12, 282–83

  • Hernández de Cos, P., 364

  • Hibbs, D., 7, 97

  • High Council of Finance (HCF), in Belgium, 413, 418–22, 420f–422f

  • HIPC. See Heavily Indebted Poor Countries

  • Hobbes, Thomas, 431

  • Horizon. See Political horizon

  • Horton, M., 182

  • Hsiao, C., 493–94

  • Hua Guofeng, 255

  • Human capital

    • public investment in, 113

    • public social spending and, 156n10

  • Hume, David, 431

  • Humphrey, T., 435

  • Hyde, S. D., 65, 75, 75n18, 127

  • Iceland, ER in, 306, 308, 309

  • ICRG. See International Country Risk Guide

  • Ideological approach, to PBCs, 112, 113

  • Ideology. See Cabinet ideology

  • IFS. See International Financial Statistics

  • Illera, R. M., 9

  • ILOSTAT of, of International Labour

  • Organization, 140n3

  • Ilzetzki, E., 178n3

  • IMF. See International Monetary Fund

  • Impulse-response functions (IRFs), for promise gaps, 43–45, 45 f, 46f

  • Inclusive politics, 243–44

  • Income tax. See Corporate income taxes; Personal income taxes

  • Incumbents

    • deficit bias and, 402, 406

    • Great Recession and, 179

    • in Italy, 331

    • reelection of, 63, 63n1

    • taxes and, 99

    • wage bill and, 145

  • Independent fiscal agency, 380, 385

  • India, 67n10

  • Indicative targets (IT), 478

  • Indirect taxes, in LICs, 67n9

  • Inertial patterns, for fiscal noncompliance, 361t–363t, 364, 365f

  • Inflation

    • ER and, 309

    • in LICs, 66

    • taxes and, 93

  • Institutions. See Budget institutions; Fiscal institutions; Political institutions

  • Intergovernmental fiscal arrangements, 380

    • budget forecasts and, 388

    • fiscal noncompliance and, 16, 350, 352, 372

    • public investment and, 11

  • International Country Risk Guide (ICRG), corruption guide of, 220, 500

  • International Financial Statistics (IFS), of IMF, 194, 194n25, 500

  • International Labour Organization

    • ILOSTAT of, 140n3

    • LABORSTA of, 140n3

  • International Monetary Fund (IMF)

    • advanced economies and, 76n19

    • balance of payments and, 480n5

    • conditionality of, 477–501, 478f, 479t, 480n5, 483f, 484f, 489t, 491t–493t, 496t, 498t, 501t

    • emerging economies and, 76n19

    • on energy subsidies, 154n4

    • Fiscal Council Dataset of, 228, 228n17

    • fiscal crises and, 96–97

    • GFS of, 140n3, 481

    • Great Recession and, 195

    • Harmonized Government Wage and Employment Data of, 140

    • IFS of, 194, 194n25, 500

    • LICs and, 65, 75–77, 75n18, 76n19, 76n20, 77n22, 80t

    • MONA of, 482, 500

    • PRGF of, 494n23

    • PRGT of, 66, 494n23

    • programs, 13, 17, 64–65, 72, 74t, 75–78, 80t, 85, 96–97, 102t, 104, 105, 106t, 107t, 108t, 187t, 188t, 191, 195, 196t, 198t, 201t, 203t, 204t, 477–501

    • revenue conditionality of, 17

    • taxes and, 477–501, 478f, 479t, 483f, 484f, 489t, 491t–493t, 498t, 501t

    • trade openness and, 76

    • See also World Economic Outlook

  • International policy, Great Recession and, 195

  • Ireland, promise gaps in, 53

  • IRFs. See Impulse-response functions

  • Israel, ER in, 311

  • Issing, Otmar, 444

  • IT. See Indicative targets

  • Italy

    • Budget Law of 2003

    • in, 330n4

    • capital spending in, 331–32, 331n7, 332f, 336f

    • DSP in, 327–40, 333f, 334f

    • elections in, 331

    • fiscal rules in, 327–40, 330t, 341t

    • fiscal space in, 331

    • incumbents in, 331

    • PBCs in, 327–40

    • promise gaps in, 53

    • RD in, 335–39, 335 f, 336f, 337t, 338f, 339t, 340t

  • Jalles, João Tovar, 12, 15

  • Japan

    • ER in, 306

    • promise gaps in, 53

  • Jaramillo, Laura, 14–15, 14n22

    • on tax tipping points, 246

  • Jensen, H., 404n5

  • Jinjarak, Y., 178n3

  • Johnsen, C., 9

    • on common pool, 215

  • Jones, B. F., 244

  • Jong-a-Pin, R. M., 200

  • Jonung, L., 415

  • Jordà, O., 43

  • Josephs, Tom, 16

  • Jurado, I., 197

  • Kaasch, A., 9

  • Kahneman, D., 244n1

  • Kammas, P., 97

  • Katsimi, M., 115n10, 130n34

  • Katz, J., 43

  • Keefer, P., 98

  • Keen, M., 155

  • Khemani, S., 67n10

  • Kincaid, Russell, 428

  • Kinda, Tidiane, 15

    • on Fiscal Council Dataset, 228n17

  • Kiser, E., 245

  • Klein, N., 112n1

  • Klomp, J., 7n13, 137n1

  • KOF. See Swiss Economic Institute

  • Kontopoulos, Y., 9

    • on political fragmentation, 198, 218

  • Kopits, G., 100n12

  • Kosovo, ER in, 306

  • Kraay, A., 119, 282, 285

  • Kraft, J., 9

  • Kuncic, A., 487

  • LABORSTA, of International Labour Organization, 140n3

  • Laeven, L., 96, 96n8

  • Lago-Peñas, S., 347, 364

  • Lagos State, Nigeria. See Nigeria

  • Laporte, B., 480

  • Larch, M., 11n20, 415

  • Leal, T., 347, 364

  • Left-wing governments, 7–8

    • deficits of, 8n16

    • government spending of, 113

    • in Great Recession, 197

    • taxes in, 8

    • VAT and, 13, 98

  • Legal capacity, property rights and, 245, 249, 249f, 260

  • Lehman Brothers, 177, 181, 193

  • Lending rate, of government, 194

  • Levi, M., 245

  • LICs. See Low-income countries

  • Likelihood ratio test

    • for promise gaps, 35n14

    • for sphericity, 280n15

  • Lithuania, ER in, 309–10

  • Litvack, J., 352

  • Liu, Estelle X., 13, 328

  • Lledó, Victor D., 16

  • Locke, John, 431

  • Lockwood, B., 84

    • on energy subsidies, 155

  • Log transformations, for tax-to-GDP ratio, 485n10

  • López Laborda, J., 347, 364

  • Low-income countries (LICs)

    • balance of payments of, 75n18

    • budget cycles in, 64–65, 68–69, 69t

    • budget institutions in, 377–97

    • centralization in, 394

    • descriptive statistics for, 79t

    • DR in, 64n4, 73n17

    • elections in, 63–78, 79t

    • fiscal balance in, 70–71, 70n12

    • fiscal rules for, 64, 64n4, 73–75, 73n15, 73n16, 74t, 77n22

    • IMF and, 65, 75–77, 75n18, 76n19, 76n20, 77n22, 80t

    • PFM for, 395

    • taxes in, 66, 67, 67n8, 67n9, 69–70, 478, 481 f

    • VAT in, 70n12

    • wage bill in, 13, 137–38, 137n1, 143, 143 f, 149

  • Lusinyan, L., 367

  • Luxembourg, ER in, 303, 306

  • Maastricht Treaty, 195

    • Belgium and, 419

    • ER and, 305–6

  • Macroeconomic forecasting, 380, 385

    • for CGs, 373

    • ER and, 299

    • in Netherlands, 415

    • for SNGs, 373

  • Maddala, G., 488

  • Mahon, J. E., 93, 96

  • Malesky, E. J., 99n10

  • Mao Zedong, 255

  • Margin of majority, in political fragmentation, 217

  • Marinov, N., 127

  • Masciandaro, D., 9

  • Maurel, M., 72

  • Mauro, P., 155

  • Mayor (sindaco), 329

  • McCallum, B., 404n5

  • McCrary, J., 335

  • MCD. See Minimum covariance determinant

  • Meade, E. E., 194

  • Media

    • in Belgium, 420–21, 421f

    • FCs and, 16, 407–13, 412t

    • in Netherlands, 416–18, 417f

  • Medium-term budgetary framework (MTBF), 395

    • in advanced economies, 314

    • CGs and, 380

    • ER and, 316, 316f

    • overspending and, 11

  • Medium-term objectives (MTOs), 446–47, 446n9

    • fiscal balance ceilings and, 446n8, 450n13

    • Fiscal Compact and, 463

    • public investment and, 452

    • by SGP, 450

  • Meltzer, A., 406n6

  • MENA. See Middle East and North Africa

  • Menocal, A. R., 243

  • Messina, G., 327

  • Middle class

    • elites and, 14

    • energy subsidies and, 154, 156

  • Middle East and North Africa (MENA), energy subsidies in, 164, 174f

  • Mihov, I., 155, 282

  • Mills, Z., 137n1, 139

  • Milner, H., 125, 126n33

  • Minimum covariance determinant (MCD), 36n18

    • for exchange rates, 280n16

  • Minimum tax-to-GDP threshold, 241

  • Ministry of Finance to the Economic and Financial Council (CPFF), in Spain, 355

  • Minority governments

    • budget forecasts of, 197

    • deficits and, 197

    • ER in, 306

    • in Great Recession, 197

    • political fragmentation and, 10, 113

  • MONA. See Monitoring and Fund Arrangements

  • Moncloa Pacts, 251–52

  • Monetary policy

    • ECB and, 442n3

    • elections and, 137n2

    • Great Recession and, 193–94

  • Monitoring and Fund Arrangements (MONA), of IMF, 482, 500

  • Moon, S., 480

  • Moore, M., 245

  • Morris, Robert, 430

  • Moser, C., 486n12

  • MTBF. See Medium-term budgetary framework

  • MTOs. See Medium-term objectives

  • Mulas-Granados, Carlos, 9, 12, 13, 13n21, 14, 15, 328

  • Müller, W. C., 26n2

  • Municipal council (consiglio comunale), 329

  • Muthoora, Priscilla, 15

  • Nannicini, T., 327, 328, 333, 339

  • National Elections across Democracy and Autocracy (NELDA), 64, 65, 125

  • Navik, J. G., 112n1

  • NELDA. See National Elections across Democracy and Autocracy

  • Netherlands

    • budget forecasts in, 416, 416f

    • Bureau for Economic Analysis in, 413, 414–18

    • coalition governments in, 415–16

    • CPB in, 414–18, 417f, 418f

    • deficit ceiling in, 415–16, 416f

    • ER in, 303, 306, 309

    • FCs in, 414–18

    • forecast errors in, 415

    • GDP in, 415

    • macroeconomic forecasting in, 415

    • media in, 416–18, 417f

    • promise gaps in, 54

  • New Tax Management Procedure, in Spain, 252

  • Ngouana, Constant Lonkeng, 13–14

  • Niehaus, P., 72

  • Nigeria

    • GDP per capita in, 262

    • taxes in, 262–64, 264f

    • tax-to-GDP threshold of, 242

  • No-bailout clause

    • of EA, 466

    • fiscal noncompliance and, 349

  • Noncompliance. See Fiscal noncompliance

  • Non-endogenous elections, 125, 125n28

  • Nordhaus, W., 112, 137n2

  • Nozaki, M., 161, 162, 163

  • Obama, Barack, 184

  • OECD. See Organisation for Economic Co-operation and Development

  • Office seekers, in partisanship, 26n2

  • OG. See Output gap

  • Ohlsson, H., 197, 198

  • Ölçer, Dilan, 12–13, 127

  • Old-age dependency ratio

    • veto players and, 223

    • from WDI, 218

  • Olden, Brian, 16

  • Olken, B. A., 244

  • OLS. See Ordinary least squares

  • Olson, M., 179

  • O’Mahony, A., 65, 75, 75n18

  • Opportunistic approach, to PBCs, 112–13, 139

  • Ordinary least squares (OLS)

    • for conditionality, 488

    • for energy subsidies, 154, 167

    • for public investment, 118

  • Ordinary legislative procedure, of EP, 442n2

  • Organisation for Economic Co-operation and Development (OECD)

    • banking crises in, 95–96

    • CIT in, 83, 84n1, 85, 86–88, 86f–87f 103, 104n19

    • on conditionality, 481

    • countries of, 85n5

    • fiscal crises in, 96–97

    • fiscal rules in, 100

    • GDP per capita in, 223n14

    • Great Recession and, 182

    • PIT in, 83, 84n1, 85, 88–90, 89f–90f 103, 104n18

    • promise gap and, 26

    • Revenue Statistics in Latin America of, 481

    • tax competition in, 95, 103

    • taxes in, 83–106, 84n1, 102t, 108t

    • VAT in, 83, 84n1, 85, 91–93, 91f–92f 103, 104n18

    • wage bill in, 139

  • Osterloh, S., 97

  • Ostrom, E., 465n25

  • Outliers

    • for exchange rates, 285

    • Great Recession and, 202

    • for PCA, 36n18

  • Output gap (OG), 33f

    • calculation of, 32n10

    • in EA, 447–48, 447f

    • endogeneity and, 449

    • FCs and, 409

    • GMM for, 449, 449n11

    • government spending and, 185

    • primary balance and, 311

    • promise gaps and, 32

    • stimulus packages for, 185

    • structural balance and, 449

  • Outright Monetary Transactions Program, of ECB, 427

  • Overfitting bias, 68

  • Overspending

    • fiscal noncompliance and, 350

  • MTBF and, 11

  • PBCs and, 333

  • Overspending incentives

    • bailouts and, 350, 351–52

    • common pool and, 352

  • PA. See Prior actions

  • Panel regression analysis

    • for ER, 318t

    • for fiscal noncompliance, 356

    • for promise gaps, 37–39, 38t–39t, 59–60, 60t

    • for public investment, 118–19

  • Panel unit root test, for public investment, 129, 129f

  • Paradisi, M., 327

  • Parliamentary polarization, in political fragmentation, 217–18

  • Parliamentary systems

    • budget institutions in, 381

    • in Great Recession, 197

    • public investment in, 111, 116, 118n16, 118n17, 125–27, 128t

    • See also Control of parliament

  • Partisanship

    • deficit bias and, 402

    • government spending and, 113, 113n5

    • office seekers in, 26n2

    • public policy and, 26n2

    • taxes and, 13

  • Passalacqua, A., 217

  • Pastrana, Andres, 260

  • PBCs. See Political business cycles

  • PCA. See Principal components analysis

  • Pedastsaar, Eliko, 16

  • Pérez, Javier J., 16

  • Performance-oriented budgeting, 380

  • Perotti, R., 9, 94, 94n6, 288

    • on exchange rates, 271–72

    • on political fragmentation, 198, 218

  • Personal income taxes (PIT)

    • conditionality and, 481 f, 485

    • in EU, 105

    • in left-wing governments, 98

    • in OECD, 83, 84n1, 85, 88–90, 89f– 90f, 103, 104n18

    • in right-wing governments, 98

    • tax competition for, 103

  • Persson, T., 3–4, 3n3, 7n13, 9n17, 241

  • Peru

    • economic shocks and, 244n1

    • ER in, 305

  • PFA. See Planned fiscal adjustment

  • PFM. See Public financial management

  • Pina, A., 200

  • PIT. See Personal income taxes

  • Planned fiscal adjustment (PFA), 29

  • Plante, M., 155

  • PLL. See Precautionary and Liquidity Line

  • Pluralism, inclusive politics and, 243–44

  • Poghosyan, Tigran, 17

  • Political accountability. See Accountability

  • Political business cycles (PBCs), 112–13

    • in advanced economies, 7n13, 63

    • capital spending and, 16, 331

    • checks and balances in, 7n13, 192n22

    • democracies and, 7n13

    • DSP and, 333

    • elections and, 113n3, 214–15

    • ER and, 300, 301

    • fiscal rules for, 327–40

    • Great Recession and, 198–200

    • in Italy, 327–40

    • opportunistic approach to, 139

    • overspending and, 333

    • Political cohesion

    • control of parliament and, 280

    • for exchange rates, 272, 274–75, 277–88, 279f

    • for fixed exchange rates, 281 f

    • for flexible exchange rates, 281 f

    • primary balance and, 283

    • public debt and, 278, 279f

    • variables for, 280–82

  • Political constraints, in Great Recession, 177–202, 201t, 203t–207t Political division. See Political fragmentation

  • Political effectiveness

    • energy subsidies and, 166, 169, 170t

    • public social spending and, 166, 169, 170t

  • Political fragility, 13–14

  • Political fragmentation

    • asymmetry of, 229

    • common pool and, 214, 217–18, 222, 230t

    • corruption and, 223

    • debt-to-GDP ratio and, 226

    • deficits and, 229

    • exchange rates and, 273

    • FCs and, 228

    • fiscal institutions and, 228

    • fiscal politics and, 9–10, 9n17

    • fiscal rules and, 228n18

    • government spending and, 229

    • in Great Recession, 14, 198

    • indicators of, 219f

    • minority governments and, 10, 113

    • promise gap and, 25, 25n2

    • public debt and, 213–29, 213n1, 219f

    • public investment and, 13n21

    • robustness tests for, 222–28

    • taxes and, 98–99

    • veto players and, 98, 214, 218, 222, 223t, 231t

  • Political horizon

    • elections and, 280

    • for exchange rates, 273–85, 278f, 288

    • for fixed exchange rates, 281 f

    • for flexible exchange rates, 281 f

    • public debt and, 278, 278f

    • variables for, 280–82

  • Political institutions, 241–65

    • for state building, 243–45, 243f

    • for taxes, 243–45, 245 f

    • See also Budget institutions; Fiscal institutions

  • Political strength, 26, 35

  • POLITY IV, 127

  • Population growth, wage bill and, 147

  • Pork-barrel spending, 215

  • Porteba, J. M., 100n13, 180

  • Porter, D., 485n10

  • Portugal, promise gaps in, 54–55

  • Posner, P., 245

  • Postlethwaite, Malachy, 431

  • Potrafke, N., 115n10

  • Poverty Reduction and Growth Facility

  • (PRGF), 494n23

  • Poverty Reduction and Growth Trust (PRGT), 66, 494n23

  • Prakash, T., 378

  • Precautionary and Liquidity Line (PLL), 494n23

  • Presidential systems

    • elections in, 64, 64n3

    • in Great Recession, 197

    • public investment in, 111, 116, 118n16, 118n17, 125–27

  • PRGF. See Poverty Reduction and Growth Facility

  • PRGT. See Poverty Reduction and Growth Trust

  • Price, Richard, 431

  • Price gap, for energy subsidies, 161

  • Primary balance

    • fiscal horizon and, 283

    • fiscal rules for, 100

    • GDP and, 30

    • OG and, 311

    • political cohesion and, 283

    • See also Cyclically adjusted primary balance

  • Principal components analysis (PCA)

    • for exchange rates, 280n16

    • for promise gaps, 32–37, 36n18, 39n21

  • Prior actions (PA), 478

  • Private sector, right-wing governments and, 8–9

  • Procyclicality, 447–50, 448n10, 449t, 470t–471t, 473t

    • deficit bias and, 450–52

    • fiscal consolidation and, 450

    • GDP and, 147

    • OG and, 451n15

  • Program countries. See International Monetary Fund programs

  • Promise gaps

    • accountability factor for, 34f, 35–37, 36t, 39n21

    • consequences of, 40–45, 59–60, 60t

    • defined, 27–30

    • determinants of, 32–39, 57t–59f

    • economic and political factors for, 33f, 37–39, 38t–39t

    • elections and, 25, 25n2

    • 15-month forecast error and, 33f

    • forecast errors and, 32

    • government popularity and, 40, 40n23, 41f–42f

    • IRFs for, 43–45, 45 f, 46f

    • likelihood ratio test for, 35n14

    • measurement of, 29–30

    • OG and, 32

    • panel regression analysis for, 37–39, 38t–39t, 59–60, 60t

  • PCA for, 32–37, 36n18, 39n21

  • political conditions for, 34f, 36t

  • political fragmentation and, 25, 25n2

  • political strength and, 35

  • proximity factor for, 34f, 35–37, 36t, 39n21

  • public debt and, 33f

  • sample selection for, 47–60

  • size of, 30f 31f 33f 34f

  • strength factor for, 34f, 35–37, 36t, 39n21

  • structural balances and, 30

  • styled facts for, 32

  • sustainability factor and, 33f

  • Property rights

    • legal capacity and, 245, 249, 249f, 260

    • protection of, 3n3, 260

  • Proximity factor

    • budget cycles and, 6, 7n13

    • fiscal politics and, 6–7

    • for promise gaps, 34f, 35–37, 36t, 39n21

  • Public Choice school, 5

  • Public debt

    • in advanced economies, 216–17, 217f, 218

    • in Belgium, 419

    • checks and balances for, 224

    • common pool and, 214, 222, 223t, 230t

    • control of parliament and, 223

    • corruption and, 223, 224t, 232t

    • debt ceilings on, 216

    • decreases in, 227t

    • in developing economies, 216–17, 217f

    • in emerging economies, 216–17, 217f

    • empirical model and data on, 215–20, 220t

    • exchange rates and, 277–78

    • FCs and, 235t, 236t, 409

    • fiscal rules for, 100

    • GDP and, 216, 222, 223

    • government spending and, 217n5

    • high level of, 234t

    • increases in, 233t

    • indicators of, 219f

    • political cohesion and, 278, 279f

    • political fragmentation and, 213–29, 213n1, 219f

    • political horizon and, 278, 278f

    • promise gaps and, 33f

    • proximity factor and, 6–7

    • quantitative limits for, 400

    • reverse causality for, 216

    • taxes and, 94

    • in U.S., 427–38

    • veto players and, 10, 214, 215, 222, 223t, 231t

    • wage bill and, 143, 147

  • Public debt sustainability

    • in Belgium, 50

    • fiscal consolidation and, 50, 85

    • taxes and, 94

  • Public expenditures. See Government spending

  • Public finance theory, taxes in, 93

  • Public financial management (PFM), 316

    • for LICs, 395

    • reform strategy for, 394

  • Public investment, 13n21, 114n7, 115n10

    • in advanced economies, 123

    • aggregate demand from, 111

    • allocation for, 123n27

    • capital spending and, 130, 130t

    • country characteristics of, 123, 124t

    • in democracies, 111–32

    • descriptive statistics for, 129t

    • in EA, 441, 452–54

    • elections and, 111–12, 112n1, 113n4, 117–23, 120t–121t, 122f, 123n27

    • ER and, 300, 313–14, 314f

    • GDP and, 122

    • GMM for, 118–19, 119n21

    • government spending and, 130, 130t

    • growth rate of, 115–16, 115f, 116f

    • in human capital, 113

    • intergovernmental fiscal arrangements and, 11

    • MTOs and, 452

    • panel unit root test for, 129, 129f

    • in parliamentary systems, 111, 116, 118n16, 118n17, 125–27, 128t

    • in presidential systems, 111, 116, 118n16, 118n17, 125–27

  • Public policy, partisanship and, 26n2

  • Public revenue. See Taxes

  • Public social spending, 14, 153–72

    • changes across regions for, 163f

    • corruption and, 158

    • countries in study for, 172t

    • crowding-out effect on, 154

    • elites and, 154

    • human capital and, 156n10

    • optimal choice for, 159

    • political effectiveness and, 166, 169, 170t

  • Public spending. See Government spending

  • Pufendorf, Samuel, 431

  • QPC. See Quantitative performance criteria

  • Quantitative Easing programs, 200

  • Quantitative performance criteria (QPC), 478

  • Rational voters, 214–15

    • balanced budget rule and, 406

  • RD. See Regression discontinuity analysis

  • Realized fiscal adjustment (RFA), 29

  • Redistribution, cabinet ideology and, 8

  • Redoano, M., 84

  • Reelection, of incumbents, 63, 63n1

  • Regression discontinuity analysis (RD), in Italy, 335–39, 335f, 336f, 337t, 338f, 339t, 340t

  • Reinhart, C. M., 288

  • Reuter, W., 346n4

  • Revenue. See Taxes

  • Revenue conditionality, of IMF, 17

  • Revenue Statistics in Latin America, of OECD, 481

  • Reverse causality

    • endogeneity and, 449

    • for ER, 311n9

    • for fiscal noncompliance, 368n25

    • for public debt, 216

  • Reverse qualified majority rule, for EC, 464

  • RFA. See Realized fiscal adjustment

  • Riedel, N., 328

  • Right-wing governments

    • crowding-out effect and, 8

    • deficits of, 8n16

    • private sector and, 8–9

    • taxes in, 8–9, 98

  • Robinson, J., 243

  • Robustness tests

    • for conditionality, 480, 494–98

    • for endogeneity of elections, 125–26

    • for exchange rates, 285–90, 286t, 287t, 289t, 290t

    • of fiscal discipline, 294t

    • for political fragmentation, 222–28

  • Rodden, J., 352

  • Rodrik, D., 485

  • Rogoff, K., 112, 119, 123, 288, 406n6

  • Romer, C. D., 27, 27n5, 181, 185

  • Romer, D. H., 27, 27n5

  • Rose, A. K., 272

  • Rose, S., 64

  • Ross, M. L., 245

  • Roubini, N., 9, 198

  • Rousseau, Pierre, 431–32

  • Rousseeuw, P. J., 36n18, 280n16, 282n19

  • Rubio, Guillermo Perry, 259

  • Rules (institutional) approach, to PBCs, 112, 113

  • Sachs, J. D., 9, 198

  • Samper, Ernesto, 260

  • Sanctions

    • common pool and, 465n25

    • in EA, 464–65

  • Sarantides, V., 115n10, 130n34

  • Sargent, Thomas, 17, 428, 438

  • SAT. See State Administration of Taxation

  • SB. See Structural benchmarks

  • SBA. See Standby Arrangements

  • Scartascini, C., 96, 98

    • on budget institutions, 378

  • SCF. See Standby Credit Facility

  • Schaechter, A., 100n12

    • on ER, 300

  • Schena, Michela, 12

  • Schuknecht, L., 137n1, 139

  • Schumpeter, Joseph, 3, 3n2, 241

  • SCM. See Synthetic control methodology

  • SCPs. See Stability and Convergence Program

  • Seiwald, Johann, 16, 407

    • on FCs, 401

  • Seki, K., 218

  • Selection bias

    • conditionality and, 486–87

    • in elections, 64–65

  • Sensitivity, 450

    • of exchange rates, 285–90, 286t

  • Seton, William, 434, 435

  • SGP. See Stability and Growth Pact

  • Shepsle, K. A., 9

    • on common pool, 215

  • Shi, M., 70n12, 137n1

  • Sibert, A., 406n6

  • Sindaco (mayor), 329

  • Sinking Fund, 434

  • Six Pack, in EU, 100, 105

  • Smith, Adam, 3–4, 3n3, 431

  • SNGs. See Subnational governments

  • Social spending. See Public social spending

  • SOEs. See State-owned enterprises

  • Soft budget constraints

    • for CGs, 345

    • fiscal noncompliance and, 349–50, 350f

    • forecasting and, 346

    • for SNGs, 345

  • Solow, R. M., 10

  • Soto, Mauricio, 13

  • Spain

    • Autonomous Communities in, 347

    • BSL in, 353–55, 355n13

    • CPFF in, 355

    • decentralization in, 30n8, 347, 367n21

    • deficits in, 356n17

    • fiscal noncompliance in, 345–73, 373t, 374t

    • GDP per capita in, 253, 253f

    • government spending in, 367n22

    • promise gaps in, 55

    • SCM in, 291–93, 292f

    • taxes in, 251–54, 253f, 254f, 254t

    • VAT in, 252

  • Spence, Michael, 244

  • Spending. See Capital spending;

    • Government spending;

    • Overspending; Public social

    • spending

  • Sphericity, likelihood ratio test for, 280n15

  • Spolaore, E., 180

  • Stability and Convergence Program (SCPs), of European Commission, 27, 47, 101, 353, 408–9

  • Stability and Growth Pact (SGP), 83, 195, 226n16, 346, 417, 444, 446–57

    • MTOs by, 450

    • past reforms in, 462–64, 463

  • Stabilization, 5, 5n5

  • Standby Arrangements (SBA), 494n23

  • Standby Credit Facility (SCF), 494n23

  • Starke, P., 9

  • State Administration of Taxation (SAT), in China, 256–57

  • State building

    • political institutions for, 243–45, 243f

    • tipping points and, 246–49

  • State-owned enterprises (SOEs)

    • bailouts of, 166

    • in China, 242, 255–56

    • energy subsidies and, 166

  • Status quo

    • changes to, 244n1

    • veto players and, 10, 14, 215

  • Stein, E., 97

  • Steinwand, M., 486n12

  • Stephan, A., 197

  • Stimulus packages

    • for economic shocks, 180

    • globalization and, 191

    • for Great Recession, 179–97, 183t, 187t–189t, 190f, 200, 202

    • for OG, 185

    • trade openness and, 178n3

  • Stock, J., 488

  • Stone, R., 486n12

  • Strand, J., 155

  • Strauch, R. R., 94, 94n6

    • on ER, 300

  • Streb, J. M., 192n22

  • Strength factor, for promise gaps, 34f, 35–37, 36t, 39n21

  • Strom, K., 26n2

  • Structural balances

    • fiscal rules for, 100

    • GDP and, 30

    • OG and, 449

    • promise gaps and, 30

  • Structural benchmarks (SB), 478, 483

  • Sturm, Jan-Egbert, 14, 486n12

    • on central banks, 194n26

    • on coalition governments, 198

  • Subnational governments (SNGs)

    • bailouts for, 349n7

    • deficits and, 345

    • fiscal rules by, 15–16

    • macroeconomic forecasting for, 373

    • soft budget constraints for, 345

  • Summers, Larry, 185

  • Sun, Y., 272, 274, 275

  • Supranational fiscal policy, 16–17

    • in EA, 439

  • Sustainability factor

    • defined, 32n9

    • promise gaps and, 32n9, 33f

    • See also Public debt sustainability

  • Svensson, J., 70n12, 137n1

  • Sweden

    • ER in, 303, 306, 310

    • promise gaps in, 55–56

  • Swiss Economic Institute (KOF), 194n26

    • Globalization Index of, 186, 191, 191n21, 195, 487

  • Sy, A., 262

  • Sylla, Richard, 428, 431–32, 433, 435

  • Symansky, S. A., 100n12

  • Synthetic control methodology (SCM), 291, 292f, 295–96, 295f

  • Synthetic index of governance, for energy subsidies, 162

  • System-GMM estimator, 68, 486–87, 486n11, 492, 494n21

  • Tabellini, G., 7n13, 9, 9n17

    • on FCs, 402

  • Tavares, José, 9, 15, 288

  • Taxes

    • balanced budget rule and, 102t

    • banking crises and, 95–96, 96n8

    • centralization of, 256

    • in China, 254–57, 258f

    • in Colombia, 259–60, 261f

    • common pool and, 215, 441 n1

    • competition with, in OECD, 95, 103

    • conditionality for, 477–501, 478f, 479t, 483f, 484f, 489t, 491t–493t, 496t, 498t, 501t

    • crisis mode for, 95–97, 103–4

    • debt sustainability and, 94

    • decentralization of, 367n21

    • in EA, 441–42, 452–54

    • elites and, 15

    • in emerging economies, 70

    • energy subsidies and, 160

    • in EU, 100–101, 105, 107t, 442

    • fiscal consolidation and, 94–95, 94n5, 94n6

    • fiscal crises and, 96–97

    • fiscal noncompliance and, 366–67

    • fiscal rules for, 104

    • GDP and, 482

    • GDP growth rate and, 93

    • GDP per capita and, 247

    • incumbents and, 99

    • inflation and, 93

    • in left-wing governments, 8

    • in LICs, 66, 67, 67n8, 67n9, 69–70, 478, 481 f

    • in Nigeria, 262–64, 264f

    • in OECD, 83–106, 84n1, 102t, 106t, 108t

    • partisanship and, 13

    • political determinants of, 97–99, 104

    • political fragmentation and, 98–99

    • political institutions for, 243–45, 245 f

    • public debt and, 94

    • in public finance theory, 93

    • revenue volatility of, 248f

    • in right-wing governments, 8–9, 98

    • in Spain, 251–54, 253f, 254f, 254t

    • tipping points for, 241–42, 246–49, 246f, 247f, 248f

    • in U.S., 98

    • wage bill and, 97

    • See also Corporate income taxes; Personal income taxes; Value-added taxes

  • Tax state, 3, 3n2

  • Tax-to-GDP-growth, tipping point for, 14–15

  • Tax-to-GDP ratio, 479

    • in China, 256, 257

    • conditionality and, 496

    • log transformations for, 485n10

  • Tax-to-GDP threshold

    • countries crossing, 266t

    • GDP per capita and, 246, 246f

    • tipping points and, 241–42

  • Teräsvirta, T., 45

  • Ter-Minassian, T., 352

  • Thornton, H., 435

  • Time inconsistency problem, 441

  • Tinubu, Bola, 262–63

  • Tipping points

    • in advanced economies, 241

    • in developing economies, 241

    • GDP per capita and, 241

    • state building and, 246–49

    • for taxes, 241–42, 246–49, 246f, 247f, 248f

    • for tax-to-GDP-growth, 14–15

    • tax-to-GDP threshold and, 241–42

  • Tolosa, G., 274n8

  • Tommasino, P., 327

  • Torgler, B., 245

  • Tornell, A., 272, 274, 274n7, 275, 281

  • Torvik, R., 262

  • Trade and Development Report, of UNCTAD, 177

  • Trade openness, 165, 295

    • conditionality and, 485

    • GDP and, 500

    • IMF and, 76

    • measurement of, 220

    • stimulus packages and, 178n3

  • Transparency International, corruption index of, 485–86

  • Trebesch, Christoph, 432, 436

  • Troiano, U., 327, 328, 333

  • Tsebelis, G., 98

  • Tversky, A., 244n1

  • Two Pack, in EU, 100, 105

  • UCD. See Unión de Centro Democrático

  • UNCTAD, 182

    • Trade and Development Report of, 177

  • Unión de Centro Democrático (UCD), 251–52

  • United Kingdom, promise gaps in, 56

  • United Nations, World Population Prospects of, 140

  • United States (U.S.)

    • bonds in, 17, 429

    • Continental financial system in, 427–35

    • ER in, 306, 308, 311

    • Federal Reserve in, 180

    • Great Recession in, 184–85

    • promise gaps in, 56–57

    • public debt in, 427–38

    • taxes in, 98

  • Urgent Tax Reform Measures, in Spain, 252

  • U.S. See United States

  • Utility function, energy subsidies and, 156n8

  • Valencia, F., 96, 96n8

  • Value-added taxes (VAT)

    • CGs and, 256

    • in China, 256, 257

    • in Colombia, 259–360

    • conditionality and, 481 f, 485, 488

    • in EA, 85

    • energy subsidies and, 155

    • in EU, 83, 100, 105

    • GDP and, 103

    • in left-wing governments, 13, 98

    • in LICs, 70n12

    • in OECD, 83, 84n1, 85, 91–93, 91f– 92f, 103, 104n18

    • as regressive, 97–98

    • in right-wing governments, 98

    • in Spain, 252

    • tax competition for, 103

  • Van den Noord, P., 99

  • Van Driessen, K., 36n18, 280n16

  • Van Eden, Holger, 16

  • Van Hooren, F., 9

  • Vaquero, A., 347, 364

  • VAR. See Vector autoregression

  • VAT. See Value-added taxes

  • Vaubel, R., 76n20

  • Vector autoregression (VAR), 43–45

  • Veiga, F., 113n4, 328

  • Veiga, L., 113n4, 328

  • Velasco, A., 272, 274, 274n7, 275, 281

  • Venes, N. M., 200

  • Venezuela, economic shocks and, 244n1

  • Verdier, Geneviève, 13

  • Vergne, C., 72

  • Vertical fiscal imbalances (VFIs), 352, 366–67, 367n23

  • Veto players, 99n10

    • checks and balances and, 218

    • legislative periods and, 221t

    • old-age dependency ratio and, 223

    • political fragmentation and, 98, 214, 218, 222, 223t, 231t

    • public debt and, 214, 215, 222, 223t, 231t

    • status quo and, 10, 14, 215

  • VFIs. See Vertical fiscal imbalances

  • Volverink, B., 9

  • Von Hagen, Jürgen, 13, 94, 94n6, 99

    • on ER, 300

  • Wage bill

    • in advanced economies, 149

    • capital spending and, 139

    • consumption multiplier with, 139

    • cross-country variation in, 143–45, 143f

    • data on, 140–3, 140n3, 141t–142t

    • demographics and, 141t–142t, 142, 145

    • elections and, 13, 137–49, 146t, 147t, 148t

    • in emerging economies, 13, 151

    • GDP and, 140, 144f, 145, 146–7, 149t

    • GDP growth rate and, 142, 147

    • in government spending, 137

    • incumbents and, 145

    • in LICs, 13, 137–38, 137n1, 143, 143f, 149

    • in OECD, 139

    • population growth and, 147

    • public debt and, 143, 147

    • taxes and, 97

    • working-age population and, 140, 142t, 146n4, 148–9

  • Wagner, R. E., 5

  • Wagner’s law, 144

  • Wallace-Wells, B., 185

  • Wälti, S., 96

  • Warlters, M., 485n10

  • Washington Consensus, 244n1

  • WDI. See World Development Indicators

  • Weber, Anke, 15

  • Weingast, B. R., 9

    • on common pool, 215

  • Weise, C. L., 180

  • WEO. See World Economic Outlook

  • West African Economic and Monetary Union, fiscal rules in, 73n15

  • Weyland, K., 244n1

  • Williams, L. K., 218

  • Windmeijer, F., 68

  • Wingender, Philippe, 14–15, 14n22

    • on tax tipping points, 246

  • Winkler, B., 443

  • Working-age population, wage bill and, 140, 142t, 146n4, 148–49

  • World Bank

    • corruption indicators of, 223

    • See also Database of Political Institutions; World Development Indicators

  • World Development Indicators (WDI), 66, 114, 118n19

    • on conditionality, 500

    • on energy subsidies, 162

    • old-age dependency ratio from, 218

  • World Economic Outlook (WEO), 114, 140n3

    • on conditionality, 481

    • on expenditure rule compliance, 307

    • on fiscal space, 185

    • on GDP, 32n11

    • on Great Recession, 182

    • for LICs, 66

    • on wage bill, 140

  • World Economic Yearbook, 127

  • World Governance Indicators, of World Bank, 162

  • World Population Prospects, of United Nations, 140

  • World Trade Organization, 256

  • World Values Survey, 253

    • on China, 257

    • on Colombia, 260

  • Wren-Lewis, S., 401, 413

  • Wright, Robert, 431, 435

  • Wu, S., 488

  • Yläoutinen, Sami, 16

    • on budget institutions, 378

    • on ER, 300

  • Yogo, M., 488

  • Yohai, V. J., 282, 282n19

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