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Author Fritz, Verena

Title Strengthening public financial management : exploring drivers and effects / Verena Fritz, Stephanie Sweet, and Marijn Verhoeven
Published [Washington, D.C.] : World Bank, ©2014


Description 1 online resource (55 pages) : color illustrations
Series Policy research working paper ; 7084
Policy research working papers ; 7084.
Summary This paper explores two relationships, first between country characteristics and the quality of public financial management ('drivers'), and second between the quality of public financial management systems and expected outcomes ('effects'). On the influence of country characteristics, the paper investigates economic factors (income level, growth, and resource dependency), population size, levels and sources of revenue, and three macro-political characteristics -- political stability, regime type, and the presence of programmatic parties. These characteristics jointly explain about 40 percent of the variation in the quality of public financial management across countries. Furthermore, first-difference analysis suggests that countries with lower initial public financial management quality improve at a higher rate over time. This implies that structural factors set the scene for the likelihood of better or worse performance, but also that there is substantial variation among countries sharing certain characteristics and reform opportunities exist even in unfavorable environments. Methodologically, a key limitation is that the direction of causality cannot be fully addressed with the types of data available. On the effects of the performance of public financial management, the paper finds evidence that stronger performance results in better budget credibility, but not in lower deficits. Furthermore, there is no clear evidence regarding operational efficiency. The observed disconnect could be caused by missing complementary state capacities, measurement problems, or other issues, which need to be explored further. Overall, the findings are consistent with the assumption that stakeholder incentives and constellations matter and that reform approaches combining good technical calibration and political economy considerations are likely to influence success in strengthening public financial management
Notes "November 2014."
"World Bank Group, Governance Global Practice Group."
Bibliography Includes bibliographical references (pages 52-53)
Notes Online resource; title from pdf title page (World Web site, viewed November 6, 2014)
Subject Finance, Public -- Management
Economic policy.
Economic policy.
Finance, Public -- Management.
Form Electronic book
Author Sweet, Stephanie
Verhoeven, Marijn
World Bank. Governance Global Practice Group.