When the Cycle Becomes the Trend : The Emerging Market Experience with Fiscal Policy during the Last Commodity Super Cycle

Fiscal buffers have shrunk across the world. This paper argues that limited fiscal room in emerging market economies today is partly due to the commodity super cycle of 2000-15. The super cycle created the mirage that economic performance had struc...

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Main Authors:	Amra, Rashaad, Hanusch, Marek, Jooste, Charl
Format:	Working Paper
Language:	English
Published:	World Bank, Washington, DC 2019
Subjects:	BUSINESS CYCLE EMERGING MARKET ECONOMIES FISCAL POLICY COMMODITY PRICES FISCAL TRENDS PUBLIC EXPENDITURE
Online Access:	http://documents.worldbank.org/curated/en/355881547823983112/When-the-Cycle-Becomes-the-Trend-The-Emerging-Market-Experience-with-Fiscal-Policy-during-the-Last-Commodity-Super-Cycle http://hdl.handle.net/10986/31180

id	okr-10986-31180
recordtype	oai_dc
spelling	okr-10986-311802021-11-15T12:21:51Z When the Cycle Becomes the Trend : The Emerging Market Experience with Fiscal Policy during the Last Commodity Super Cycle Amra, Rashaad Hanusch, Marek Jooste, Charl BUSINESS CYCLE EMERGING MARKET ECONOMIES FISCAL POLICY COMMODITY PRICES FISCAL TRENDS PUBLIC EXPENDITURE Fiscal buffers have shrunk across the world. This paper argues that limited fiscal room in emerging market economies today is partly due to the commodity super cycle of 2000-15. The super cycle created the mirage that economic performance had structurally improved, mistaking a long, commodity-fueled uptick in the business cycle for higher trend growth. This thinking supported fiscal expansions. When the commodity boom ended, it became apparent that countries had saved less than they should have, and that fiscal policy had, perhaps inadvertently, been pro-cyclical. It left countries with depleted fiscal buffers and large budgets when the cycle came to an end, limiting room for fiscal stimulus when needed. The paper illustrates the argument with reference to the South African experience. 2019-01-31T21:47:52Z 2019-01-31T21:47:52Z 2019-01 Working Paper http://documents.worldbank.org/curated/en/355881547823983112/When-the-Cycle-Becomes-the-Trend-The-Emerging-Market-Experience-with-Fiscal-Policy-during-the-Last-Commodity-Super-Cycle http://hdl.handle.net/10986/31180 English Policy Research Working Paper;No. 8712 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper Africa South Africa
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	BUSINESS CYCLE EMERGING MARKET ECONOMIES FISCAL POLICY COMMODITY PRICES FISCAL TRENDS PUBLIC EXPENDITURE
spellingShingle	BUSINESS CYCLE EMERGING MARKET ECONOMIES FISCAL POLICY COMMODITY PRICES FISCAL TRENDS PUBLIC EXPENDITURE Amra, Rashaad Hanusch, Marek Jooste, Charl When the Cycle Becomes the Trend : The Emerging Market Experience with Fiscal Policy during the Last Commodity Super Cycle
geographic_facet	Africa South Africa
relation	Policy Research Working Paper;No. 8712
description	Fiscal buffers have shrunk across the world. This paper argues that limited fiscal room in emerging market economies today is partly due to the commodity super cycle of 2000-15. The super cycle created the mirage that economic performance had structurally improved, mistaking a long, commodity-fueled uptick in the business cycle for higher trend growth. This thinking supported fiscal expansions. When the commodity boom ended, it became apparent that countries had saved less than they should have, and that fiscal policy had, perhaps inadvertently, been pro-cyclical. It left countries with depleted fiscal buffers and large budgets when the cycle came to an end, limiting room for fiscal stimulus when needed. The paper illustrates the argument with reference to the South African experience.
format	Working Paper
author	Amra, Rashaad Hanusch, Marek Jooste, Charl
author_facet	Amra, Rashaad Hanusch, Marek Jooste, Charl
author_sort	Amra, Rashaad
title	When the Cycle Becomes the Trend : The Emerging Market Experience with Fiscal Policy during the Last Commodity Super Cycle
title_short	When the Cycle Becomes the Trend : The Emerging Market Experience with Fiscal Policy during the Last Commodity Super Cycle
title_full	When the Cycle Becomes the Trend : The Emerging Market Experience with Fiscal Policy during the Last Commodity Super Cycle
title_fullStr	When the Cycle Becomes the Trend : The Emerging Market Experience with Fiscal Policy during the Last Commodity Super Cycle
title_full_unstemmed	When the Cycle Becomes the Trend : The Emerging Market Experience with Fiscal Policy during the Last Commodity Super Cycle
title_sort	when the cycle becomes the trend : the emerging market experience with fiscal policy during the last commodity super cycle
publisher	World Bank, Washington, DC
publishDate	2019
url	http://documents.worldbank.org/curated/en/355881547823983112/When-the-Cycle-Becomes-the-Trend-The-Emerging-Market-Experience-with-Fiscal-Policy-during-the-Last-Commodity-Super-Cycle http://hdl.handle.net/10986/31180
_version_	1764473726472028160

When the Cycle Becomes the Trend : The Emerging Market Experience with Fiscal Policy during the Last Commodity Super Cycle

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