To help ensure that advanced country governments pursue responsible fiscal policies, countries should adopt formal rules for limiting structural deficits, which are supported by primary legislation or constitutional reform.
Answer:
Neither agree nor disagree
Confidence level:
Confident
Comment:
I have two reasons for neither agreeing nor disagreeing. The first is that the measurement of structural deficits is so difficult that it is open to abuse as well as innocent errors, and the latter can be enormous - e.g. the OECD's estimates in successive Economic Outlooks for the UK's structural deficit in 2007 have risen from below 0.5% (2007 estimate) to 4.9% (2013estimate). Second, trying to incorporate such limits in legislation is partly petty politics (trying to provoke the opposition) and partly dubious economic policy (trying to fix policy for all future time, in a way that ignores possible shocks and trends). It is better to argue out the need for appropriate constraints in a democratic way, which means convincing and reconvincing successive generations of politicians and electors, and accepting that in an uncertain world governments just have to allowed to exercise at least some discretion.
The CFM surveys informs the public about the views held by prominent economists based in Europe on important macroeconomic and public policy questions. Some surveys focus specifically on the UK economy (as the CFM is a UK research centre), but surveys can in principle focus on any macroeconomic question for any region. The surveys shed light on the extent to which there is agreement or disagreement among these experts. An important motivation for the survey is to give a more comprehensive overview of the beliefs held by economists and in particular to include the views of those economists whose opinions are not frequently heard in public debates.
Questions mainly focus on macroeconomic and public policy topics. Although there are some questions that focus specifically on the UK economy, the setup of the survey is much broader and considers questions related to other countries/regions and also considers questions not tied to a specific economy.
The surveys are done in collaboration with the Centre for Economic Policy Research (CEPR).
Responsible long-term fiscal policy (pilot survey)
Second question:
To help ensure that advanced country governments pursue responsible fiscal policies, countries should adopt formal rules for limiting structural deficits, which are supported by primary legislation or constitutional reform.
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