Why budget reliability matters Accurate revenue and expenditure forecasting is crucial for effective budgeting to ensure that governments can adequately plan for public services, infrastructure projects, and social programs without unexpected shortfalls. When forecasting is not accurate, governments may not be able to achieve fiscal stability and deliver on policy priorities. In this blog, we try […]
In 2018, after 3 years of droughts, the city of Cape Town in South Africa faced severe water shortages. Dam reservoir capacity had dropped to critical levels and the city was fast approaching “Day Zero” of no water availability. Desalination, new dams, strict water usage limits – all solutions were on the table. Solving the […]
As governments around the world combatted COVID-19, the US witnessed unprecedented levels of funding transfers from the federal government to state and local municipalities. This column examines how the influx of federal aid affected the population’s health. Leveraging the fact that states with excess representation in Congress received more assistance than underrepresented states, the authors […]
The fight against inflation has largely been won in the euro area, after a sharp but short-lived inflation episode over 2021-2023. This column argues that energy prices can explain the dynamics of inflation over the recent period better than the interest rate policy of the ECB. At the same time, higher interest rates led to […]
Until the late 19th century, states raised most of their government revenues from import tariffs. This column asks whether the practice could work today. A side effect of taxes is that they discourage the economic activity that they are assessed on. Tariffs are taxes on imports and no different: they shrink trade. The authors allow […]
