Asset Price Cycles, “One-Off” Factors and Structural Budget Balances

Nathalie Girouard () and Robert Price

No 391, OECD Economics Department Working Papers from OECD Publishing

Abstract: This paper analyses two factors which may cause cyclically-adjusted budget balances to give a misleading picture of underlying fiscal trends. It first explores the implications of recent large asset-market related fluctuations in government revenues for the measurement of structural budget balances. And second, it reviews the impact of the increased recourse to stopgap “one-off” measures to control deficits. The results confirm that since the late 1990s revenues have been more buoyant than would have been warranted by the registered rate of nominal output growth and the impact of tax measures. The study suggests that from 1995 to 2000 the average contribution of “unwarranted” revenues to year-to-year changes in cyclically-adjusted budget positions ranged from negligible to around ½ per cent of GDP, the main countries affected being the United States, the United Kingdom, France and some Nordic countries. Conversely, the subsequent decline in tax receipts has been sharper than could ... Cette étude analyse deux facteurs qui peuvent contribuer à brouiller la lisibilité des positions budgétaires sous-jacentes évaluées par la mesure traditionnelle du solde budgétaire corrigé des variations cycliques. Dans un premier temps, elle étudie les implications des récentes fluctuations des recettes fiscals associées aux marchés boursiers sur la mesure du solde structurel. Dans un deuxième temps, cette etude discute des effets du recours accru aux facteurs non-récurrents sur la maîtrise des déficits. Les resultants confirment que depuis la fin des années 1990, les recettes fiscales ont été plus dynamiques que ne le laissaient suggérer le taux de croissance nominal de l’activité et les effets des mesures fiscales. Entre 1995 et 2000, la contribution moyenne des recettes non-expliquées au changement annuel du solde budgétaire corrigée pour les variations cycliques oscillerait entre zéro et ½ pour cent du PIB, les principaux pays concernés étant les États-Unis, le Royaume-Uni, la ...

Keywords: asset prices; fiscal balances; prix des actifs; solde budgétaire; solde budgétaire corrigé des variations cycliques; structural balances (search for similar items in EconPapers)
JEL-codes: E32 E65 H24 H25 H6 (search for similar items in EconPapers)
Date: 2004-06-07
New Economics Papers: this item is included in nep-mac and nep-pbe
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Citations: View citations in EconPapers (18)

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Persistent link: https://EconPapers.repec.org/RePEc:oec:ecoaaa:391-en

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