IDEAS home Printed from https://ideas.repec.org/a/mnb/finrev/v21y2022i3p73-100.html
   My bibliography  Save this article

There and Back Again - Six Fiscal Tales from the Past Decades

Author

Listed:
  • Gabor P. Kiss

    (Magyar Nemzeti Bank)

Abstract

A phenomenon known in the international literature that is nevertheless unaddressed is that the standard indicators used for analysing fiscal policy can yield misleading results. Creative accounting can distort basic statistics, dividing data into groups of "revenue" and "expenditure" leads to the same distorted results, and the common indicators of the cyclically adjusted balance are also misleading. Based on the indicators adjusted for the impact of these distortions, six fiscal episodes are defined in Hungary between 1995 and 2016. The first episode is the adjustment in 1995-1996. The structure of spending changed then between 1997 and 2001. In 2002-2006, consolidation was delayed after a sudden, major round of fiscal expansion. After this, several approaches were tried to ensure consolidation, in two steps, between 2007 and 2009 and then between 2010 and 2012. Finally, between 2013 and 2016 the structure of spending was changed once again.

Suggested Citation

  • Gabor P. Kiss, 2022. "There and Back Again - Six Fiscal Tales from the Past Decades," Financial and Economic Review, Magyar Nemzeti Bank (Central Bank of Hungary), vol. 21(3), pages 73-100.
    • Handle: RePEc:mnb:finrev:v:21:y:2022:i:3:p:73-100
    as

    Download full text from publisher

    File URL: https://en-hitelintezetiszemle.mnb.hu/letoltes/fer-21-3-st3-kiss.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Gábor P. Kiss, 1998. "The Role of General Government in Hungary," MNB Working Papers 1998/4, Magyar Nemzeti Bank (Central Bank of Hungary).
    2. Jacopo Cimadomo, 2012. "Fiscal Policy in Real Time," Scandinavian Journal of Economics, Wiley Blackwell, vol. 114(2), pages 440-465, June.
    3. Judit Krekó & Gábor P. Kiss, 2008. "Tax evasion and tax changes in Hungary," MNB Bulletin (discontinued), Magyar Nemzeti Bank (Central Bank of Hungary), vol. 3(1), pages 24-34, April.
    4. Mr. Daniel Leigh & Mr. Andrea Pescatori & Mr. Jaime Guajardo, 2011. "Expansionary Austerity New International Evidence," IMF Working Papers 2011/158, International Monetary Fund.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gábor P. Kiss, 2020. "Aggregate Fiscal Stabilisation Policy: Panacea or Scapegoat?," Financial and Economic Review, Magyar Nemzeti Bank (Central Bank of Hungary), vol. 19(2), pages 55-87.
    2. Juan Antonio Cerón Cruz, 2011. "¿Qué preocupa a los gobiernos, la brecha de producción o el PIB?," Revista de Economia Critica, Asociacion de Economia Critica, vol. 12, pages 199-205.
    3. Gustav A. Horn & Fabian Lindner & Silke Tober & Andrew Watt, 2012. "Where now for the euro area crisis? Interim assessment and a model for a stable euro area," IMK Report 75e-2012, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    4. Achim Truger, 2015. "Implementing the golden rule for public investment in Europe," Working Paper Reihe der AK Wien - Materialien zu Wirtschaft und Gesellschaft 138, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik.
    5. Agnes Benassy-Quere, 2016. "Euro-Area Fiscal Stance: From Theory to Practical Implementation," CESifo Working Paper Series 6040, CESifo.
    6. Hauptmeier, Sebastian & Sanchez-Fuentes, A. Jesus & Schuknecht, Ludger, 2011. "Towards expenditure rules and fiscal sanity in the euro area," Journal of Policy Modeling, Elsevier, vol. 33(4), pages 597-617, July.
    7. Katja Schmidt & Antoine Sigwalt, 2022. "Fiscal policy orientation in the euro area in real-time," Working papers 896, Banque de France.
    8. Afonso, António & Huart, Florence & Tovar Jalles, João & Stanek, Piotr, 2022. "Twin deficits revisited: A role for fiscal institutions?," Journal of International Money and Finance, Elsevier, vol. 121(C).
    9. James Cloyne & Òscar Jordà & Alan M. Taylor, 2020. "Decomposing the Fiscal Multiplier," Working Paper Series 2020-12, Federal Reserve Bank of San Francisco.
    10. David Cronin, 2020. "Are Member States’ Budgetary Policies Adhering to the EU Fiscal Rules?," Applied Economics Quarterly (formerly: Konjunkturpolitik), Duncker & Humblot GmbH, Berlin, vol. 66(1), pages 47-64.
    11. Sebastian Gechert, 2015. "What fiscal policy is most effective? A meta-regression analysis," Oxford Economic Papers, Oxford University Press, vol. 67(3), pages 553-580.
    12. Larch, Martin & Cugnasca, Alessandro & Kumps, Diederik & Orseau, Eloïse, 2019. "Fiscal policy and the assessment of output gaps in real time: An exercise in risk management," ZEW Discussion Papers 19-013, ZEW - Leibniz Centre for European Economic Research.
    13. Manfred Overhaus & Ulrich Maas & Aiginger. Karl & Margit Schratzenstaller-Altzinger, 2012. "Weg aus dem Schuldenhaushalt: Ist eine Tilgung der Staatsschulden möglich?," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 65(05), pages 03-14, March.
    14. Aurel IANCU & Dan Constantin OLTEANU, 2022. "Procyclical and Countercyclical Fiscal Policies in Non-Euro EU Member Countries," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(3), pages 188-205, October.
    15. Luca Agnello & Davide Furceri & Ricardo M. Sousa, 2011. "Fiscal Policy Discretion, Private Spending, and Crisis Episodes," NIPE Working Papers 31/2011, NIPE - Universidade do Minho.
    16. Juha Kilponen & Massimiliano Pisani & Sebastian Schmidt & Vesna Corbo & Tibor Hledik & Josef Hollmayr & Samuel Hurtado & Paulo Júlio & Dmitry Kulikov & Matthieu Lemoine & Matija Lozej & Henrik Lundval, 2019. "Comparing Fiscal Consolidation Multipliers across Models in Europe," International Journal of Central Banking, International Journal of Central Banking, vol. 15(3), pages 285-320, September.
    17. Mr. Ruy Lama & Juan Pablo Medina Guzman, 2015. "Fiscal Consolidation During Times of High Unemployment: The Role of Productivity Gains and Wage Restraint," IMF Working Papers 2015/262, International Monetary Fund.
    18. Joan Paredes & Javier J. Pérez & Gabriel Perez Quiros, 2023. "Fiscal targets. A guide to forecasters?," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 38(4), pages 472-492, June.
    19. Nicholas Crafts, 2013. "Returning to growth: lessons from the 1930s," Working Papers 13010, Economic History Society.
    20. Neven Vidakovic & Iva Mesi?, 2011. "Radna snaga i perspektive ekonomskoga oporavka u Republici Hrvatskoj," Ekonomija Economics, Rifin d.o.o., vol. 18(2), pages 279-312.

    More about this item

    Keywords

    fiscal expansion; consolidation; cyclical adjustment; creative accounting;
    All these keywords.

    JEL classification:

    • E30 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - General (includes Measurement and Data)
    • H10 - Public Economics - - Structure and Scope of Government - - - General
    • H60 - Public Economics - - National Budget, Deficit, and Debt - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mnb:finrev:v:21:y:2022:i:3:p:73-100. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Morvay Endre (email available below). General contact details of provider: https://edirc.repec.org/data/mnbgvhu.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.