Cover IMF Working Papers
Buy Book in Print
Can Budget Institutions Counteract Political Indiscipline?
Author:
Mr. Ashoka Mody null

Search for other papers by Mr. Ashoka Mody in
Current site
Google Scholar Close
and
Ms. Stefania Fabrizio
Search for other papers by Ms. Stefania Fabrizio in
Current site
Google Scholar Close
Series:
IMF Working Papers
Volume/Issue:
Volume 2006: Issue 123
Language:
English
Publication Date:
01 May 2006
DOI:
https://doi.org/10.5089/9781451863833.001
ISBN:
9781451863833
ISSN:
1018-5941
Pages:
53
Keywords:
WP; finance minister; least squares; government fragmentation; institutions index; political economy; Fiscal policy; budget institutions; electoral rules; government ideology; ethnic fractionalization; voter turnover; General government expenditure; coalitional government; Budget planning and preparation; Fiscal stance; Unemployment rate; Central and Eastern Europe; Baltics; Eastern Europe
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
Download PDF (320.2 KB) Download Epub
The budget is an expression of political rather than economic priorities. We confirm this proposition for a group of new and potential members of the European Union, finding that politics dominates. The contemporary practice of democracy can increase budget deficits through not only ideological preferences but also more fragmented government coalitions and higher voter participation. Long-term structural forces, triggered by societal divisions and representative electoral rules, have more ambiguous implications but also appear to increase budget pressures, as others have also found. However, our most robust, and hopeful, finding is that budget institutions-mechanisms and rules of the budget process-that create checks and balances have significant value even when the politics is representative but undisciplined, and when long-term structural forces are unfavorable.
  • Collapse
  • Expand
Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund