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Determinants of compliance with fiscal rules: Misplaced efforts or hidden motivations?

Author

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  • Carolina Ulloa-Suárez

    (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique, Sciences Po - Sciences Po)

Abstract
This paper empirically examines which factors have influenced numerical compliance with fiscal rules in Latin American and Caribbean countries over the period 2000 to 2020. We use logistic regression models to associate three groups of specific factors with a greater or lesser probability of compliance with the rule: the macroeconomic and political environment of the countries and the design features of the enforced rules. We find that only changes in the macroeconomic and political context affect the probability of compliance with the enforced rules. In contrast, the institutional design of the fiscal rules does not seem to play an essential role in the compliance outcome. This result suggests that adjustments in this direction are not decisive for rule compliance.

Suggested Citation

  • Carolina Ulloa-Suárez, 2023. "Determinants of compliance with fiscal rules: Misplaced efforts or hidden motivations?," Post-Print hal-04171829, HAL.
    • Handle: RePEc:hal:journl:hal-04171829
    DOI: 10.1016/j.ejpoleco.2023.102399
    Note: View the original document on HAL open archive server: https://amu.hal.science/hal-04171829
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    References listed on IDEAS

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    Cited by:

    1. Ardanaz, Martín & Ulloa-Suárez, Carolina & Valencia, Oscar, 2024. "Why don't we follow the rules? Drivers of compliance with fiscal policy rules in emerging markets," Journal of International Money and Finance, Elsevier, vol. 142(C).

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