Contingent Liabilities : A Threat to Fiscal Stability
The economic policy note discusses the issue of serious fiscal instability faced by many governments as a result of their contingent liabilities, which are associated with major hidden fiscal risks. Direct liabilities are predictable obligations th...
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| Format: | Brief |
| Language: | English |
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World Bank, Washington, DC
2012
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| Online Access: | http://documents.worldbank.org/curated/en/1998/11/438760/contingent-liabilities-threat-fiscal-stability http://hdl.handle.net/10986/11522 |
| Summary: | The economic policy note discusses the
issue of serious fiscal instability faced by many
governments as a result of their contingent liabilities,
which are associated with major hidden fiscal risks. Direct
liabilities are predictable obligations that will arise in
any event, and are the main subject of conventional fiscal
analysis. Conversely, contingent liabilities are obligations
triggered by a discreet but uncertain event, and are not
always accounted for fully. The note further discusses
explicit and implicit liabilities of a central government,
suggesting ways to reduce fiscal risks for the policy makers. |
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