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Fiscal Sustainability
Fiscal sustainability, or public finance sustainability, is the ability of a government to sustain its current spending, tax and other policies in the long run without threatening government solvency or defaulting on some of its liabilities or promised expenditures. There is no consensus among economists on a precise operational definition for fiscal sustainability, rather different studies use their own, often similar, definitions. However, the European Commission defines public finance sustainability as: the ability of a government to sustain its current spending, tax and other policies in the long run without threatening the government's solvency or without defaulting on some of the government's liabilities or promised expenditures. Many countries and research institutes have published reports which assess the sustainability of fiscal policies based on long-run projections of country's public finances (see for example, [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Fiscal Gap
The fiscal gap is a measure of a government's total indebtedness proposed by economists Laurence Kotlikoff and Alan Auerbach, who define it as the difference between the present value of all of government's projected financial obligations, including future expenditures, including servicing outstanding official federal debt, and the present value of all projected future tax and other receipts, including income accruing from the government's current ownership of financial assets. According to Kotlikoff and Auerbach, the "fiscal gap" accounting method can be used to calculate the percentage of necessary tax increases or spending reductions needed to close the fiscal gap in the long-run. Generational accounting, an accounting method closely related to the fiscal gap, has been proposed by the same authors as a measure of the future burden of closing the fiscal gap. The "generational accounting" assumes that current taxpayers are neither asked to pay more in taxes nor receive less in tran ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Primary Deficit
The government budget balance, also alternatively referred to as general government balance, public budget balance, or public fiscal balance, is the overall difference between government revenues and spending. A positive balance is called a ''government budget surplus'', and a negative balance is a ''government budget deficit''. A government budget is a financial statement presenting the government's proposed revenues and spending for a financial year. A budget is prepared for each level of government (from national to local) and takes into account public social security obligations. The government budget balance can be broken down into the ''primary balance'' and interest payments on accumulated government debt; the two together give the budget balance. Furthermore, the budget balance can be broken down into the ''structural balance'' (also known as ''cyclically-adjusted balance'') and the cyclical component: the structural budget balance attempts to adjust for the impact of ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Debt-to-GDP Ratio
In economics, the debt-to-GDP ratio is the ratio between a country's government debt (measured in units of currency) and its gross domestic product (GDP) (measured in units of currency per year). While it is a "ratio", it is technically measured in units of year, and can be interpreted as the number of years a country needs to pay off its entire debt, if all its GDP is devoted towards it. A low debt-to-GDP ratio indicates that an economy produces goods and services sufficient to pay back debts without incurring further debt. Geopolitical and economic considerations – including interest rates, war, recessions, and other variables – influence the borrowing practices of a nation and the choice to incur further debt. It should not be confused with a deficit-to-GDP ratio, which, for countries running budget deficits, measures a country's annual net fiscal loss in a given year ( total expenditures minus total revenue, or the net change in debt per annum) as a percentage share of tha ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Fiscal Council
A fiscal council is an independent body set up by a government to evaluate its expenditure and tax policy. Typically, councils are staffed by economists and statisticians who do not have the ability to set policy, but provide advice to governments and the public on the economic effects of government budgets and policy proposals. Some fiscal councils also provide economic forecasting. Fiscal councils evaluate government's fiscal policies, plans and performance publicly and independently, against macroeconomic objectives related to the long-term sustainability of public finances, short-to-medium-term macroeconomic stability, and other official objectives. History Several fiscal councils arose following the financial crisis of 2007–08 with the intention of avoiding debt crises and alleviating the problem of deficit bias, which is a tendency of governments to allow increasing long-term deficits. Analysis from the International Monetary Fund proposes that deficit bias results from ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Old Age Dependency Ratio
The dependency ratio is an age-population ratio of those typically not in the labor force (the ''dependent'' part ages 0 to 14 and 65+) and those typically in the labor force (the ''productive'' part ages 15 to 64). It is used to measure the pressure on the productive population. Consideration of the dependency ratio is essential for governments, economists, bankers, business, industry, universities and all other major economic segments which can benefit from understanding the impacts of changes in population structure. A low dependency ratio means that there are sufficient people working who can support the dependent population. A lower ratio could allow for better pensions and better health care for citizens. A higher ratio indicates more financial stress on working people and possible political instability. While the strategies of increasing fertility and of allowing immigration especially of younger working age people have been formulas for lowering dependency ratios, future ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Labor Force
The workforce or labour force is a concept referring to the pool of human beings either in employment or in unemployment. It is generally used to describe those working for a single company or industry, but can also apply to a geographic region like a city, state, or country. Within a company, its value can be labelled as its "Workforce in Place". The workforce of a country includes both the employed and the unemployed (labour force). Formal and informal Formal labour is any sort of employment that is structured and paid in a formal way.Seager, Joni. 2008. The Penguin Atlas of Women in the World. 4th ed. New York: Penguin Books. Part 5 Unlike the informal sector of the economy, formal labour within a country contributes to that country's gross national product. Informal labour is labour that falls short of being a formal arrangement in law or in practice. It can be paid or unpaid and it is always unstructured and unregulated.Seager, Joni. 2008. The Penguin Atlas of Women in th ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Nudge Theory
Nudge theory is a concept in behavioral economics, decision making, behavioral policy, social psychology, consumer behavior, and related behavioral sciences that proposes adaptive designs of the decision environment (choice architecture) as ways to Social influence, influence the behavior and decision making, decision-making of groups or individuals. Nudging contrasts with other ways to achieve compliance, such as education, legislation or enforcement. The nudge concept was popularized in the 2008 book ''Nudge (book), Nudge: Improving Decisions About Health, Wealth, and Happiness'', by behavioral economist Richard Thaler and legal scholar Cass Sunstein, two American scholars at the University of Chicago. It has influenced British and American politicians. Several nudge units exist around the world at the national level (UK, Germany, Japan, and others) as well as at the international level (e.g. World Bank, United Nations, UN, and the European Commission). It is disputed whether "n ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Government Debt
A country's gross government debt (also called public debt, or sovereign debt) is the financial liabilities of the government sector. Changes in government debt over time reflect primarily borrowing due to past government deficits. A deficit occurs when a government's expenditures exceed revenues. Government debt may be owed to domestic residents, as well as to foreign residents. If owed to foreign residents, that quantity is included in the country's external debt. In 2020, the value of government debt worldwide was $87.4 US trillion, or 99% measured as a share of gross domestic product (GDP). Government debt accounted for almost 40% of all debt (which includes corporate and household debt), the highest share since the 1960s. The rise in government debt since 2007 is largely attributable to the global financial crisis of 2007–2008, and the COVID-19 pandemic. The ability of government to issue debt has been central to state formation and to state building. Public debt ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Government Budget Deficit
The government budget balance, also alternatively referred to as general government balance, public budget balance, or public fiscal balance, is the overall difference between government revenues and spending. A positive balance is called a ''government budget surplus'', and a negative balance is a ''government budget deficit''. A government budget is a financial statement presenting the government's proposed revenues and spending for a financial year. A budget is prepared for each level of government (from national to local) and takes into account public social security obligations. The government budget balance can be broken down into the ''primary balance'' and interest payments on accumulated government debt; the two together give the budget balance. Furthermore, the budget balance can be broken down into the ''structural balance'' (also known as ''cyclically-adjusted balance'') and the cyclical component: the structural budget balance attempts to adjust for the impact of ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Fiscal Policy
In economics and political science, fiscal policy is the use of government revenue collection (taxes or tax cuts) and expenditure to influence a country's economy. The use of government revenue expenditures to influence macroeconomic variables developed in reaction to the Great Depression of the 1930s, when the previous laissez-faire approach to economic management became unworkable. Fiscal policy is based on the theories of the British economist John Maynard Keynes, whose Keynesian economics theorised that government changes in the levels of taxation and government spending influence aggregate demand and the level of economic activity. Fiscal and monetary policy are the key strategies used by a country's government and central bank to advance its economic objectives. The combination of these policies enables these authorities to target inflation (which is considered "healthy" at the level in the range 2%–3%) and to increase employment. Additionally, it is designed to try to k ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Government Spending
Government spending or expenditure includes all government consumption, investment, and transfer payments. In national income accounting, the acquisition by governments of goods and services for current use, to directly satisfy the individual or collective needs of the community, is classed as government final consumption expenditure. Government acquisition of goods and services intended to create future benefits, such as infrastructure investment or research spending, is classed as government investment (government Gross fixed capital formation, gross capital formation). These two types of government spending, on final consumption and on gross capital formation, together constitute one of the major components of gross domestic product. Government spending can be financed by government borrowing, taxes, custom duties, the sale or lease of natural resources, and various fees like national park entry fees or licensing fees. When Governments choose to borrow money, they have to gov ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Government Budget
A government budget is a document prepared by the government and/or other political entity presenting its anticipated tax revenues (Inheritance tax, income tax, corporation tax, import taxes) and proposed spending/expenditure (Healthcare, Education, Defence, Roads, State Benefit) for the coming financial year. In most parliamentary systems, the budget is presented to the legislature and often requires approval of the legislature. Through this budget, the government implements economic policy and realizes its program priorities. Once the budget is approved, the use of funds from individual chapters is in the hands of government ministries and other institutions. Revenues of the state budget consist mainly of taxes, customs duties, fees and other revenues. State budget expenditures cover the activities of the state, which are either given by law or the constitution. The budget in itself does not appropriate funds for government programs, hence need for additional legislative measur ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
