European Parliament Library

A toolkit for Assessing Fiscal Vulnerabilities and Risks in Advanced Economies, Elif Arbatli Saxegaard, Emre Alper, Jiri Jonas, Anke Weber, Marc Gerard, Tidiane Kinda, Giovanni Callegari, Anna Shabunina, Andrea Schaechter, Carlos Caceres

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A toolkit for Assessing Fiscal Vulnerabilities and Risks in Advanced Economies, Elif Arbatli Saxegaard, Emre Alper, Jiri Jonas, Anke Weber, Marc Gerard, Tidiane Kinda, Giovanni Callegari, Anna Shabunina, Andrea Schaechter, Carlos Caceres
Language
eng
Abstract
This paper presents a range of tools and indicators for analyzing fiscal vulnerabilities and risks for advanced economies. The analysis covers key short-, medium- and long-term dimensions. Short-term pressures are captured by assessing (i) gross funding needs, (ii) market perceptions of default risk, and (iii) stress dependence among sovereigns. Medium- and long-term pressures are summarized by (iv) medium- and long-term budgetary adjustment needs, (v) susceptibility of debt projections to growth and interest rate shocks, and (vi) stochastic risks to medium-term debt dynamics. Aiming to cover a wide range of advanced economies and minimize data lags, has also influenced the selection of empirical methods. Due to these features, they can, for example, help inform the joint IMF-FSB Early Warning Exercise (EWE) on the fiscal dimensions of economic risks
Bibliography note
Includes bibliographical references
resource.governmentPublication
international or intergovernmental publication
Literary form
non fiction
Main title
A toolkit for Assessing Fiscal Vulnerabilities and Risks in Advanced Economies
Nature of contents
dictionaries
Responsibility statement
Elif Arbatli Saxegaard, Emre Alper, Jiri Jonas, Anke Weber, Marc Gerard, Tidiane Kinda, Giovanni Callegari, Anna Shabunina, Andrea Schaechter, Carlos Caceres
Series statement
IMF Working Papers
Table of contents
Cover; Contents; I. Introduction; II. Fiscal Vulnerabilities and Risks: Dimensions, Indicators and Analytical Tools; A. Short-Term Pressures: Gross Funding Needs, Market Perceptions, and Susceptibility to Spillovers; B. Medium- and Long-Run Pressures and Susceptibility to Shocks; III. An Illustrative Application of the Methods, Tools, and Indicators; Figures; 1. Illustrative Stochastic Debt Projections; A. Gross Funding Needs, Market Perceptions, and Susceptibility to Spillovers; 2. Indicators of Fiscal Vulnerabilities and Risks-Funding Needs and Market PerceptionsB. Medium- and Long-Run Pressures and Susceptibility to Shocks3. Indicators of Fiscal Vulnerabilities and Risks-Focusing on the Medium and Long Run; C. Bringing the Indicators Together; IV. Conclusions and Ways Forward; Appendix: Technical Aspects of the Vulnerability and Risk Assessment Tools; A. Data Sources; B. Distress Dependence Among Sovereigns; C. Medium- and Long-Term Adjustment Needs to Ensure Fiscal Sustainability; D. Vulnerabilities to Adverse Growth and Interest Rate Shocks; E. Stochastic Simulations: Medium-Term Risks to Public Debt Trajectories; References