Walking Up the Down Escalator : Public Investment and Fiscal Stability

Fiscal adjustment becomes like walking up the down escalator when growth-promoting spending is cut so much as to lower growth and thus the present value of future tax revenues to a degree that more than offsets the improvement in the cash deficit....

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Bibliographic Details
Main Authors:	Easterly, William, Irwin, Timothy, Servén, Luis
Format:	Policy Research Working Paper
Language:	English
Published:	World Bank, Washington, DC 2012
Subjects:	ACCOUNTING ACCOUNTING STANDARDS ACCRUAL ACCOUNTING ADJUSTMENT PROGRAMS AGGREGATE BUDGET AGGREGATE DEMAND ASSET VALUE BRIBES BUDGET ALLOCATION BUDGET DEPARTMENT BUDGET SURPLUS BUDGETARY MANAGEMENT BUDGETARY RESOURCES BURDEN OF TAXATION CAPITAL ACCUMULATION CAPITAL EXPENDITURE CAPITAL EXPENDITURES CAPITAL NEEDS CAPITAL STOCK CASH DEFICIT CASH FLOW CASH FLOWS COMPETITIVE MARKETS COMPOSITION OF EXPENDITURES CORPORATE GOVERNANCE COST OF CAPITAL COST RECOVERY DEBT DEBT CRISIS DEBT DYNAMICS DEFICIT FINANCE DEFICIT FINANCING DEFICITS EDUCATION EXPENDITURES EDUCATION SERVICES ENTITLEMENTS EXPECTED RETURNS EXPENDITURE CUTS EXPENDITURE ITEM EXPENDITURES FINANCIAL ASSETS FINANCIAL MARKET FINANCIAL REPORTING FINANCIAL REPORTS FISCAL ADJUSTMENT FISCAL AGGREGATES FISCAL AUSTERITY FISCAL AUTHORITIES FISCAL DEFICIT FISCAL DISCIPLINE FISCAL INSTITUTIONS FISCAL PERFORMANCE FISCAL POLICY FISCAL POSITION FISCAL PROJECTIONS FISCAL RETRENCHMENT FISCAL RULES FISCAL STABILITY FISCAL STANCE FISCAL STIMULUS FISCAL STRATEGIES FISCAL STRATEGY FISCAL TARGETS FUNGIBILITY GOVERNMENT SOLVENCY GROSS DEBT GROWTH OF PUBLIC SPENDING GROWTH POTENTIAL GROWTH RATES HIGHER INTEREST HIGHER INTEREST RATES INDEPENDENT AUDITOR INFRASTRUCTURE INVESTMENT INFRASTRUCTURE PROJECTS INFRASTRUCTURE SERVICES INVESTMENT DECISIONS INVESTMENT FLOWS INVESTMENT PROJECTS INVESTMENT RISK LATIN AMERICAN LEVEL OF INDEBTEDNESS LIQUIDITY MACROECONOMIC MODEL MACROECONOMIC STABILITY MACROECONOMIC STABILIZATION MARGINAL COST MARGINAL EXCESS MARGINAL EXCESS BURDEN MARKET VALUE NET LENDING NET WORTH PERFORMANCE INDICATORS PERFORMANCE TARGETS POLITICIANS POVERTY REDUCTION PRESENT VALUE PRIMARY DEFICIT PRIVATE FIRMS PRIVATE INVESTMENT PRIVATE INVESTORS PRIVATE SECTOR PRIVATE SECTOR INVOLVEMENT PRIVATE SECTOR PARTICIPATION PROFITABILITY PROGRAMS PROVISION OF INFRASTRUCTURE PUBLIC PUBLIC CAPITAL PUBLIC CONSUMPTION PUBLIC DEBT PUBLIC ENTERPRISES PUBLIC ENTITIES PUBLIC EXPENDITURE PUBLIC EXPENDITURES PUBLIC FINANCES PUBLIC GOODS PUBLIC INFRASTRUCTURE PUBLIC INVESTMENT PUBLIC INVESTMENT IN INFRASTRUCTURE PUBLIC INVESTMENT PROGRAM PUBLIC INVESTMENT SPENDING PUBLIC INVESTMENTS PUBLIC PROCUREMENT PUBLIC REVENUES PUBLIC SECTOR PUBLIC SECTOR BORROWING PUBLIC SECTOR BORROWING REQUIREMENT PUBLIC SECTOR NET WORTH PUBLIC SECTOR PROJECTS PUBLIC SECTOR RETRENCHMENT PUBLIC SECTOR SOLVENCY PUBLIC SERVICES PUBLIC SPENDING REAL INTEREST RATE RECURRENT EXPENDITURES REVENUE COLLECTION REVENUE INCREASES RISK PREMIUM ROADS SOCIAL RETURN SOCIAL RETURNS SPENDING CUTS SUB-SAHARAN AFRICA TAX TAX BASES TAX COLLECTION TAX RATE TAX REVENUE TAX REVENUES TAXATION TELECOMMUNICATIONS TOTAL SPENDING TRANSPARENCY UNCERTAINTY UTILITIES
Online Access:	http://documents.worldbank.org/curated/en/2007/03/7435956/walking-up-down-escalator-public-investment-fiscal-stability http://hdl.handle.net/10986/7191