Fiscal Responsibility Laws Fail to Improve Fiscal Discipline Across Nations
Fiscal Responsibility Laws were introduced in many countries to improve fiscal performance, but it's unclear if they actually worked. A study looked at Latin American and advanced economies and found that these laws didn't have a significant impact on fiscal performance. The researchers used a different method than usual to analyze the data and considered the effects of business and commodity cycles. While the laws may not have directly improved fiscal balances, they could still have positive effects on budget transparency and lower risk.