Budget Forecast Errors in Spanish Municipalities: The Role of Transparency

Israel García ()
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Israel García: University of Marburg

MAGKS Papers on Economics from Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung)

Abstract: This paper examines whether budget transparency limits the use of creative accounting to circumvent fiscal rules. Using a Spanish reform that limited the obligation to provide regular budget information, I study the effect of relaxing transparency rules on budget forecast errors. I find that reducing the frequency of budget reporting leads to systematic underestimation of planned expenditures and revenues, especially in pre-electoral periods. I also investigate gender differences in budget forecast errors after introducing a gender quota.

Keywords: Budget transparency; Fiscal rules; Political forecast cycles; Gender; Spanish municipalities (search for similar items in EconPapers)
JEL-codes: C23 D72 E62 H68 J16 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:mar:magkse:202327

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