OECD Economics Department Working Papers
Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory reform, competition, health, and other issues.
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- ISSN: 18151973 (online)
- https://doi.org/10.1787/18151973
Accounting for One-off Operations when Assessing Underlying Fiscal Positions
Frequent recourse to large one-off operations in a number of OECD countries has undermined the
accuracy of cyclically adjusted fiscal balances as a measure of both the sustainability of public finance and
the fiscal stance. This paper first provides detailed information on the nature and amount of these one-offs
for 9 OECD countries. The paper then presents a new indicator – the “underlying” fiscal balance – which
effectively eliminates the impact of one-offs and cyclical developments. One-offs are derived as the
deviations from trend in net capital transfers, i.e. from widely available national account data. This
approach provides a consistent treatment of one-offs both across countries and over time, avoiding the
potential information biases which could result from an individual identification of one-offs.
Keywords: cyclically-adjusted budget balance, fiscal balances
JEL:
H30: Public Economics / Fiscal Policies and Behavior of Economic Agents / Fiscal Policies and Behavior of Economic Agents: General;
E62: Macroeconomics and Monetary Economics / Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook / Fiscal Policy;
H60: Public Economics / National Budget, Deficit, and Debt / National Budget, Deficit, and Debt: General
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