Aspects of Fiscal Performance in Some Transition Economies Under Fund-Supported Programs

Abstract

This paper contains a selective review of some of the key fiscal issues faced by transition economies. The twelve countries that provide the empirical background for this study have all been under Fund programs for at least some of the time since they initiated their transitions from plan to market. The focus of the paper is on medium-and longer-term fiscal issues, such as government solvency and the evaluation of the sustainability of the government's fiscalfinancial-monetary program. The purpose of the paper is to assist the design and implementation of future Fund programs and to improve the quality of the debate about the design and conduct of fiscal policy in transition economies generally.

Pembiayaan Defisit dengan Utang dan Ketahanan Fiskal di Indonesia

“…Hal ini bisa terjadi karena kebanyakan negara-negara Eropa Barat pasca Perang Dunia II berangkat dari kondisi perekonomian yang sama. Buiter (1997) C t = konsumsi pemerintah pada periode t T t = pajak setelah dikurangi transfer dan subsidi E t = nilai tukar di pasar spot = nilai bantuan luar negeri dalam mata uang asing F t = aliran kas dari sektor publik A t = pembentukan modal domestik di sektor publik PRIV t = dana hasil privatisasi i t = suku bunga utang publik domestik = nilai nominal face value kewajiban domestik pemerintah termasuk tunggakan maupun yang sedang berjalan = suku bunga utang dalam denominasi mata uang asing = nilai nominal kewajiban luar negeri termasuk bunga, tunggakan dankewajiban bank sentral dalam denominasi mata uang asing = cadangan devisa T t-1 = stok uang beredar…”

“…Mengacu pada kerangka teori yang dibangun di atas, dengan memodifikasi model Buiter (1997), model Cudington (1996 …”

Poland: a successful transition to budget sustainability?

“…See Buiter (1996) and Budina and van Wijnbergen (1997). This was undoubtedly sensible in the early stages of transition when policy was evolving rapidly, and there was no relevant stable historical experience on which to base an analysis.…”

“…However, solvency and sustainability are not the same concept. According to Buiter (1990) for example, "only if there exists no economically and politically feasible set of tax, spending and seignorage plans that permit the existing stock of debt to be serviced, can one truly speak of [government] insolvency." The problem with (4) is that it does not by itself restrict the relationships between revenues, expenditures and debt sufficiently to provide useful, testable hypotheses about the sustainability of current fiscal policy.…”

“…Most research on these countries has focussed on the immediate effectiveness of fiscal reforms. Exceptionally, Buiter (1996) and Budina and van Wijnbergen (1997) calculated measures of fiscal sustainability for a sample of the transition economies. However, they did not conduct any formal statistical tests of sustainability.…”