Creating and Using Fiscal Space for Accelerated Development in Liberia

Lofgren, Hans

World Bank, Washington, DC

关键词: ACCOUNTING;    ADMINISTRATIVE COSTS;    AGRICULTURAL SECTORS;    AGRICULTURE;    BALANCE OF PAYMENTS;   

DOI  :  10.1596/1813-9450-6678
RP-ID  :  WPS6678

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

This paper presents simulations for theperiod 2013-2030 of measures that permit increased spendingon infrastructure and human development, the priority areasin Liberia's 2013-2017 "Agenda forTransformation" and for its national vision, LiberiaRising 2030. The simulations are carried out with a Liberianversion of MAMS (Maquette for Millennium Development GoalsSimulations), a Computable General Equilibrium model.According to the results, among the key sources of fiscalspace, foreign grants generate the best outcomes followed byimproved government allocative efficiency. Taxes tend toinvolve trade-offs since they reduce resources for privateconsumption and investment, both of which tend to contributeto stronger macro and Millennium Development Goalsperformance. Increased foreign borrowing is less attractivesince, in order to make a substantial difference, it wouldquickly add to the foreign debt, making the economy morecrisis-prone and less flexible. The preferred balancebetween different uses of fiscal space depends on payoffsfrom different government functions, typically unknown oronly appearing with a lag. Under the parameters used in thesimulations, determined in light of fragmentary evidence,the outcomes were marginally stronger under a balancedapproach with scaling up of both infrastructure and humandevelopment services. Balanced expansion may also contributeto efficiency and be easier for political reasons. A finalfinding is that it is possible to consider fiscal spaceissues in isolation from the mining sector: simulationssuggest that the marginal effects of creating additionalfiscal space are very similar irrespective of the level ofmining export prices.