Economic, Political and Institutional Determinants of Budget Deficits in the European Union

Using an extended data set of EU countries ranging from 1971-2006 and relevant econometric methods, we investigate the economic, political, and institutional determinants of government deficits in the EU. The results show a strong opportunistic behaviour of policymakers which leads to political business cycles. We find that political fragmentation does not play a significant role in government deficits. Partisan behaviour has a weak effect. The stability of the government has a significant negative impact on the size of the budget deficit. The paper also shows the significant effects of the Maastricht Treaty on fiscal consolidation.fiscal policy, European Monetary Union

Government Deficits in the European Union: An Analysis of Entry and Exit Dynamics

The extent of government deficits and debt has been one of the most debated issues in recent years. However, much less has been contributed about their dynamics. Yet, the issue of entering into and exiting from excessive deficits is critical in the Economic and Monetary Union since the Stability and Growth Pact rules out deficits larger than 3 percent of GDP, unless countries face strictly defined unusual conditions. This paper provides a transition data analysis of the dynamics of public deficits. It shows the asymmetric role played by the economic determinants in these dynamics and estimates the evolution of the probability of entering into and exiting from excessive deficits for every individual member state of the European Union that signed the Maastricht Treaty, since 1970. It also reveals how the concurrence of some minor changes may produce a major switchover in public finance outcomes. Finally, it analyses the evolution over time of the probabilities that countries will enter or escape from the state of having excessive deficit, and hence the fragility of some countries even if they are now out of excessive deficits.fiscal policy, Economic and Monetary Union, duration models

Economic and Political Determinants of Budget Deficits in the European Union: A Dynamic Random Coefficient Approach

This paper formulates a dynamic Random Coefficient Model (RCM) to consider a set of popular determinants of public deficits in the EU-15 over the period 1971-2006, both at a country-specific level and from a population-wide perspective. Although the extent of government deficits and debt has been one of the most debated macroeconomic issues in recent times, the models trying to capture the explanatory powers driving these deficits typically estimate models that pose the strict assumption of homogeneity on the coefficients over all countries in the model. The sensibility of this assumption will be investigated, with results showing that an increase in the degree of heterogeneity leads to an improvement in the model fit and provides additional information to nuance the effects of the explanatory variables. In this way, the paper exposes a limited degree of partisanship over all countries under consideration, but on the other hand provides evidence for opportunistic behaviour of policymakers in the major part of the sample. The effect of institutional changes following the enforcement of the Maastricht Treaty varies over the countries and is related to the necessity of budgetary consolidation.fiscal policy, European Monetary Union, Random Coefficient Model, Bayesian Analysis

Economic and political determinants of budget deficits in the European Union: a dynamic random coefficient approach

This paper formulates a dynamic Random Coefficient Model (RCM) to consider a set of popular determinants of public deficits in the EU-15 over the period 1971-2006, both at a country-specific level and from a population-wide perspective. Although the extent of government deficits and debt has been one of the most debated macroeconomic issues in recent times, the models trying to capture the explanatory powers driving these deficits typically estimate models that pose the strict assumption of homogeneity on the coefficients over all countries in the model. The sensibility of this assumption will be investigated, with results showing that an increase in the degree of heterogeneity leads to an improvement in the model fit and provides additional information to nuance the effects of the explanatory variables. In this way, the paper exposes a limited degree of partisanship over all countries under consideration, but on the other hand provides evidence for opportunistic behaviour of policymakers in the major part of the sample. The effect of institutional changes following the enforcement of the Maastricht Treaty varies over the countries and is related to the necessity of budgetary consolidation

Government deficits in the European Union : an analysis of entry and exit dynamics

The extent of government deficits and debt has been one of the most debated issues in recent years. However, much less has been contributed about their dynamics. Yet, the issue of entering into and exiting from excessive deficits is critical in the Economic and Monetary Union since the Stability and Growth Pact rules out deficits larger than 3 percent of GDP, unless countries face strictly defined unusual conditions. This paper provides a transition data analysis of the dynamics of public deficits. It shows the asymmetric role played by the economic determinants in these dynamics and estimates the evolution of the probability of entering into and exiting from excessive deficits for every individual member state of the European Union that signed the Maastricht Treaty, since 1970. It also reveals how the concurrence of some minor changes may produce a major switchover in public finance outcomes. Finally, it analyses the evolution over time of the probabilities that countries will enter or escape from the state of having excessive deficit, and hence the fragility of some countries even if they are now out of excessive deficits

Economic, political and institutional determinants of budget deficits in the European Union

Using an extended data set of EU countries ranging from 1971-2006 and relevant econometric methods, we investigate the economic, political, and institutional determinants of government deficits in the EU. The results show a strong opportunistic behaviour of policymakers which leads to political business cycles. We find that political fragmentation does not play a significant role in government deficits. Partisan behaviour has a weak effect. The stability of the government has a significant negative impact on the size of the budget deficit. The paper also shows the significant effects of the Maastricht Treaty on fiscal consolidation

Modeling Russia for Climate Change Issues

This paper presents the dynamic multi-sector general equilibrium model for the Russian Federation (RusMod) and carbon emission projections for Russia up to 2020.Projection results emphasise the importance of accomplishing strong energy efficiency gains, and their effect on the economy and on emissions of greenhouse gases. However, they also show that emissions can be expected to grow at a much higher rate if the efficiency improvements targeted by the government are not realised or when they stay behind compared to the 40% goal as it was set by president Medvedev. Model simulations also show that the introduction of a carbon price as a policy instrument can have a strong impact on the emissions, which comes at the expense of a decline in economic growth that is of a much more temporary nature.

Modeling Russia for Climate Change Issues

This paper presents the dynamic multi-sector general equilibrium model for the Russian Federation (RusMod) and carbon emission projections for Russia up to 2020. Projection results emphasise the importance of accomplishing strong energy efficiency gains, and their effect on the economy and on emissions of greenhouse gases. However, they also show that emissions can be expected to grow at a much higher rate if the efficiency improvements targeted by the government are not realised or when they stay behind compared to the 40% goal as it was set by president Medvedev. Model simulations also show that the introduction of a carbon price as a policy instrument can have a strong impact on the emissions, which comes at the expense of a decline in economic growth that is of a much more temporary nature

Local control of hepatocellular carcinoma and colorectal liver metastases after surgical microwave ablation without concomitant hepatectomy

Purpose Microwave ablation (MWA) is an accepted technique in the multimodal treatment of hepatocellular carcinoma (HCC) and colorectal liver metastases (CRLM). Study endpoints were to evaluate the local efficacy of surgical MWA in selected patients with oligonodular disease without the combination of liver resection to allow a clear interpretation of the follow-up imaging and compare it to the results on percutaneous MWA available in the literature. Methods Consecutive MWA-only procedures performed between May 2013 and May 2018 for HCC and CRLM with free-hand ultrasound guidance were identified. MWA systems with 2450 MHz were used. Incomplete ablation (IA) was defined as residual disease within 1 cm of the ablation site at the first post-ablation imaging and local recurrence (LR) as the presence of disease after at least one tumor-free imaging. Results A total of 70 tumors in 47 patients were treated with 46 laparoscopic and 1 open procedures. Each patient had no more than 3 tumors, and median size of the lesions was 15 mm (IQR: 10-22). After a median follow-up of 26 months (IQR: 12-40), IA rate was 8.6% and LR rate was 29.4%. Multivariable analysis showed that vascular proximity (OR = 3.4; 95% CI = 1.26-9.22; p=0.016) was the only significant predictor of the combined outcome IA or LR. Discussion In the present study, after mostly laparoscopic MWA, LR was higher than the rates available in the literature for percutaneous MWA of HCC but lower than in the limited studies analyzing isolated percutaneous MWA of liver metastases. Future developments may help establish the role of each therapeutic modality per tumor, in order to improve the outcomes