03999oam 22008894 450 991015501310332120200520144314.01-4755-5578-41-4755-5583-0(CKB)3710000000973034(MiAaPQ)EBC4867571(Au-PeEL)EBL4867571(CaPaEBR)ebr11391095(CaONFJC)MIL974480(OCoLC)965708779(IMF)WPIEA2016230(EXLCZ)99371000000097303420020129d2016 uf 0engurcnu||||||||rdacontentrdamediardacarrierFiscal Discipline and Exchange Rates : Does Politics Matter? /João Tovar Jalles, Carlos Mulas-Granados, José TavaresWashington, D.C. :International Monetary Fund,2016.1 online resource (30 pages) illustrations, tablesIMF Working Papers1-4755-5576-8 Includes bibliographical references.We look at the effect of exchange rate regimes on fiscal discipline, taking into account the effect of underlying political conditions. We present a model where strong politics (defined as policymakers facing longer political horizon and higher cohesion) are associated with better fiscal performance, but fixed exchange rates may revert this result and lead to less fiscal discipline. We confirm these hypotheses through regression analysis performed on a panel sample covering 79 countries from 1975 to 2012. Our empirical results also show that the positive effect of strong politics on fiscal discipline is not enough to counter the negative impact of being at/moving to fixed exchange rates. Finally, we use the synthetic control method to illustrate how the transition from flexible to fully fixed exchange rate under the Euro impacted negatively fiscal discipline in European countries. Our results are robust to a number of important sensitivity checks, including different estimators, alternative proxies for fiscal discipline, and sub-sample analysis.IMF Working Papers; Working Paper ;No. 2016/230Foreign exchange ratesPolitical aspectsForeign ExchangeimfPublic FinanceimfStructure, Scope, and Performance of GovernmentimfNational Deficit SurplusimfDebtimfDebt ManagementimfSovereign DebtimfCurrencyimfForeign exchangeimfPublic finance & taxationimfExchange rate arrangementsimfConventional pegimfGovernment asset and liability managementimfExchange rate flexibilityimfExchange ratesimfPublic financial management (PFM)imfFinance, PublicimfAustriaimfForeign exchange ratesPolitical aspects.Foreign ExchangePublic FinanceStructure, Scope, and Performance of GovernmentNational Deficit SurplusDebtDebt ManagementSovereign DebtCurrencyForeign exchangePublic finance & taxationExchange rate arrangementsConventional pegGovernment asset and liability managementExchange rate flexibilityExchange ratesPublic financial management (PFM)Finance, Public332.45Jalles João Tovar1378689Mulas-Granados Carlos502576Tavares José1451324DcWaIMFBOOK9910155013103321Fiscal Discipline and Exchange Rates3651459UNINA