Credit Ratings and Fiscal Responsibility

M. Hanusch, P. Vaaler | The World Bank

In this study, the authors investigate whether and how private, for profit credit rating agencies (CRAs) influence the fiscal policy of national governments. Fiscal policy is a key instrument for national authorities to provide key public services to the population and support a well-functioning macroeconomy. Countercyclical fiscal policy is an important tool for governments to mediate the impact of adverse economic shocks to firms and households. In countries with a pegged exchange rate—where monetary policy is geared toward maintaining the peg—fiscal policy is the most important policy tool to enhance national welfare.

Categories:
South Africa, Nigeria, Lesotho, Kenya, Cape Verde, Botswana, Credit Ratings
Pages:
24
Year of publication:
30.06.2015
File size:
1930367 bytes