scholarly journals Fiscal Rules, Financial Stability and Optimal Currency Areas

2015 ◽  
Author(s):  
Paul De Grauwe ◽  
Pasquale Foresti
Keyword(s):  
Financial Stability ◽  
Fiscal Rules ◽  
Optimal Currency Areas

scholarly journals Fiscal rules, financial stability and optimal currency areas

2016 ◽  
Vol 145 ◽  
pp. 278-281 ◽  
Author(s):  
Paul De Grauwe ◽  
Pasquale Foresti
Keyword(s):  
Financial Stability ◽  
Fiscal Rules ◽  
Optimal Currency Areas

scholarly journals The Role of Fiscal Expenditure Rules in Maintaining the Financial Stability of the State

2021 ◽  
Vol 26 (5) ◽  
pp. 213-228
Author(s):  
Ewa Lotko
Keyword(s):  
Financial Stability ◽  
Statistical Data ◽  
Research Question ◽  
The State ◽  
Fiscal Rules ◽  
Professional Literature ◽  
The Face ◽  
The Eu

Abstract One of the main challenges which legal science faces nowadays is the creation of legal mechanisms guaranteeing sound public finance. The aim of this article is to assess the role of national fiscal rules in maintaining financial stability. Firstly, to fulfil this aim, the role of fiscal rules and their efficiency was analysed. Next, based on the commonly used tool assessing the quality of national fiscal rules – the Fiscal Rule Index – the quality of expenditure rules in the EU countries was analysed in order to evaluate the Polish stabilising expenditure rule and the escape clause of its application. Therefore, the following research question is to be answered: whether in the face of an unstable financial situation of the state connected with an increasing deficit, deviation from the stabilising expenditure rule should be considered as being right. Research methods based on non-reactive research, i.e., analysis of professional literature, legal acts, and statistical data published by the European Commission, were used in this article. Due to this analysis, it was indicated that expenditure rules are regarded as one of the most effective tools to manage public funds, and therefore any derogations from the application of these rules should be evaluated negatively.

scholarly journals RULES AND ADJUSTMENT OF FISCAL POLICY

2018 ◽  
Vol 2018 (11-12) ◽  
pp. 47-59
Author(s):  
Vasyl KUDRYASHOV ◽  
Keyword(s):  
Fiscal Policy ◽  
Financial Stability ◽  
Negative Impact ◽  
Fiscal Rules ◽  
Finance Management ◽  
Foreign Countries ◽  
Budget Policy ◽  
The Government ◽  
Supranational Regulation ◽  
The Eu

The issue of using fiscal rules in budget policy implementation is covered (namely, one of the innovative mechanisms aimed at limiting fiscal imbalances and enhancing positive impacts on economic and social development). An analysis of approaches to determining the content of fiscal rules is carried out. The content’s interpretation is proposed, which reflects not only restrictive, but also corrective functions. The IMF recommendations on application of fiscal rules and supranational regulation of budget policy in the framework of integration associations, as well as their positive and negative impact on the development of Member States, were considered. It is noted that fiscal rules should be sufficiently balanced and flexible for their use in public administration. In order to increase the effectiveness of fiscal rules, significant changes have been made in the EU regarding their composition over the past years. The authors reveal the main objectives of application of fiscal rules, as well as their importance in increasing the budgetary responsibility of the government, particularly, to ensure budgetary discipline, as well as the effectiveness of spending funds. Mechanisms for adjusting the fiscal policies that are introduced in framework of fiscal rules are outlined. Particular attention is paid to measures to continue fiscal consolidation, as well as to support economic growth and financial stability. It is concluded that strengthening rigidity of fiscal rules at the supranational level in the EU hampered flexibility in managing budget resources, hence they require reform. With the use of fiscal rules, the issues of amending the institutional structure of public finance management and deepening the transparency of budget operations have been actualized. It is noted that changes to application of fiscal rules are important enough for Ukraine. The rules used in our state are insufficient and do not fully solve the tasks assigned to them. They require expansion and improvement, as well as introduction of effective implementation mechanisms. To improve the effectiveness of fiscal policy in Ukraine, one should take into account the experience of foreign countries, as well as develop and implement more detailed and flexible fiscal rules.

The Impact of Maximum Allowable Debt Level of Local Government Units on their Investment Potential

2021 ◽  
Vol 19 (4) ◽  
pp. 991-1014
Author(s):  
Ewa Gubernat ◽  
Hanna Kociemska ◽  
Bernadeta Dziedziak ◽  
Leszek Patrzalek
Keyword(s):  
Local Government ◽  
Linear Regression ◽  
Regression Model ◽  
Linear Regression Model ◽  
Financial Stability ◽  
Fiscal Rules ◽  
Economic Potential ◽  
Debt Level ◽  
Remarkable Increase ◽  
The Impact

Keeping local government units’ financial stability to run necessary projects is becoming a severe threat due to the remarkable increase of theirs’ debt level. A question arises whether the application of debt limits excessively restrict municipalities’ investment potential. Using the linear regression model, we proved that increasing the maximum allowable debt level decreases investment potential. We have challenged the relevance of using fiscal rules and presented liberalizing the fiscal rules’ principles to assess the investment potential as an indicator to guarantee optimum use of the local government units’ economic potential from different perspectives.

Analysis of tax-spend nexus for Russian regional budgets

2020 ◽  
pp. 5-29
Author(s):  
Evsey T. Gurvich ◽  
Natalia A. Krasnopeeva
Keyword(s):  
Economic Growth ◽  
Fiscal Policy ◽  
Causal Relationship ◽  
National Economy ◽  
Federal Budget ◽  
Fiscal Rules ◽  
Fiscal Discipline ◽  
Federal Level ◽  
Regional Budgets ◽  
Econometric Technique

We study the tax-spend nexus for Russian regional budgets. Causal relationship running from taxing to spending is found, thus supporting the concept “tax and spend” suggested by M. Friedman. Next, elasticity of expenditure by revenue is estimated for a panel of 80 regional budgets basing on data for 2000—2017. Estimates are in the range of 0.72 to 0.78 (depending on the econometric technique), which exceeds elasticity for the federal budget more than twice. This evidences that fiscal policy at the sub-federal (as distinct from the federal) level has clear pro-cyclical nature. Besides, the largest sensitivity of expenditure to revenue shocks is found for the item “national economy”, implying marked adverse implications for economic growth. We suggest to mitigate this effect by modifying fiscal rules for sub-federal budgets. They are currently aimed primarily at enhancing fiscal discipline, with less emphasis on countercyclical policy, insulating economy from fiscal shocks.

Macroprudential Policy Instruments of Central Banks

2012 ◽  
pp. 32-47
Author(s):  
S. Andryushin ◽  
V. Kuznetsova
Keyword(s):  
Systemic Risk ◽  
Financial Stability ◽  
Financial System ◽  
Policy Instruments ◽  
Central Banks ◽  
Macroprudential Policy ◽  
Policy Studies ◽  
The Future ◽  
Financial Cycles

The paper analyzes central banks macroprudencial policy and its instruments. The issues of their classification, option, design and adjustment are connected with financial stability of overall financial system and its specific institutions. The macroprudencial instruments effectiveness is evaluated from the two points: how they mitigate temporal and intersectoral systemic risk development (market, credit, and operational). The future macroprudentional policy studies directions are noted to identify the instruments, which can be used to limit the financial systemdevelopment procyclicality, mitigate the credit and financial cycles volatility.

The “dividend puzzle” and the Russian stock market. Part 1

2020 ◽  
pp. 66-92 ◽  
Author(s):  
A. E. Abramov ◽  
A. D. Radygin ◽  
M. I. Chernova ◽  
R. M. Entov
Keyword(s):  
Stock Market ◽  
Financial Stability ◽  
Dividend Policy ◽  
General Context ◽  
Steady Increase ◽  
Main Research ◽  
For Profit ◽  
Dividend Payments ◽  
Stock Market Performance ◽  
Dividend Irrelevance

This article analyzes the key patterns of the dividend policy and the problem of the “dividend puzzle” in the general context of the development of the stock market in Russia. The article consists of two parts.In the first part we summarize main research trends of dividend policy in modern economic theory (the classical Modigliani—Miller theory of dividend irrelevance, agent and signal hypotheses, the smoothing model, the catering theory, etc.). We emphasize the theoretical analysis of motivation of the largest Russian companies for profit allocation and dividend payout, based on a sample of 236 joint stock companies. Since 2012, a steady increase in dividend payments has been revealed in both private and state-owned enterprises (SOEs). The bulk of dividend payments from SOEs accounts for only 12 major companies. Along with an increase in the market value, dividends have become an important factor in the total return on shares. Under current conditions, the probability of paying dividends depends not only on the size of the company and indicators of its’ financial stability, but also on the presence of the state in the capital of companies. However, the relationship between the probability of paying dividends and state participation in the ownership structure is not universal and can be explained by specific factors that go beyond the classical dividend theories.In the second part we will analyze the patterns of stock market performance and dividend policy of the largest Russian companies, motivation for dividend payouts and special aspects of SOEs policy.

Fiscal rules: Excessive limitation or indispensable instrument of fiscal sustainability?

2016 ◽  
pp. 5-29 ◽  
Author(s):  
E. Gurvich ◽  
I. Sokolov
Keyword(s):  
Historical Data ◽  
Federal Budget ◽  
Fiscal Sustainability ◽  
Fiscal Rules ◽  
External Shocks ◽  
Base Price ◽  
Depth Analysis ◽  
Fiscal Balance ◽  
Lower Size ◽  
Budget Expenditure

In-depth analysis of international and Russia’s experiences with implementing fiscal rules is presented. Theoretical and empirical evidences are suggested in favor of retaining the present fiscal rules with some modifications aimed at ensuring: a) a relatively stable level of federal budget expenditure with guaranteed full execution of all commitments; b) countercyclical fiscal policy, based on flexibleand proper reaction to revenue changes; and c) robustness of fiscal rules to internal and external shocks. The main new features suggested include modified calculation of the oil base price, different measurement of cyclical fiscal revenues, lower size of structural fiscal balance, and thorough specification of sources for each item of the balance. The modified rules envisage increased flexibility by relaxing to a pre-set extent and for a pre-set time spending limits in response to extreme shocks. The suggested version of fiscal rules has been tested by application to historical data for 2005-2015, and macro projections for 2015-2025.

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