Real-time uncertainty in budget planning: evidence from euro area countries
Maritta Paloviita and
Journal of Economic Policy Reform, 2018, vol. 21, issue 4, 281-300
Using rich panel data including potential output for euro area countries, we analyse budget balance forecasts and their errors. We find that budget balance forecasts are systematically biased and subject to mean reversion (tendency towards more balanced budgets). A robust result is that errors in budget balance nowcasts contribute to errors in budget balance forecasts. In addition, we find that nowcasted macroeconomic conditions can affect over-optimism in budget balance forecasts. Overall, our results emphasize the central role of nowcasting in the EU fiscal framework.
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed
Downloads: (external link)
Access to full text is restricted to subscribers.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:taf:jecprf:v:21:y:2018:i:4:p:281-300
Ordering information: This journal article can be ordered from
Access Statistics for this article
Journal of Economic Policy Reform is currently edited by Dr Judith Clifton
More articles in Journal of Economic Policy Reform from Taylor and Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().