Fiscal sustainability, volatility and oil wealth: A stochastic analysis of fiscal spending rules
| Authors |
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| Publication date | 2011 |
| Series | Tinbergen Institute discussion paper, TI 2011-068/2 |
| Number of pages | 31 |
| Publisher | Amsterdam: Tinbergen Institute |
| Organisations |
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| Abstract | Whether fiscal policy is sustainable depends on a government's future revenue and expenditure streams, both of which are highly uncertain. In commodity-rich countries, this problem is intensified by unpredictable and volatile commodity prices. We show how spending rules for oil income and non-oil primary deficits interact and influence the stochastic distribution of future debt stocks and demonstrate the variance reducing impact of feedback rules for primary deficits in a case study of oil-and-gas exporter Azerbaijan. |
| Document type | Working paper |
| Language | English |
| Published at | http://www.tinbergen.nl/ti-publications/discussion-papers.php?paper=1759 |
| Downloads |
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