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PUBLIC EXPENDITURE AND BUDGET RULE - ANA CAROLINA GIUBERTI
Large fiscal deficits and the accumulation
of debts over a long period of time were behind the
adoption of a budget rule in Brazil, called Law of Fiscal
Responsibility (Lei de Responsabilidade Fiscal - LRF),
promulgated in 2000. This Law imposed limits on the
expenditure with personnel for all levels of government
(Federal, State and Municipal), this item being considered
one of the main expenses responsible for the Brazilian
States deficits in the 1990's. Therefore, focusing on the
Brazilian Municipal districts, this book investigates if
the problems of fiscal deficits and expenditures on
salaries and wages of public employees, including
retirement expenditures, were so high as to justify the
imposition of a fiscal rule as were in the case of
Brazilian states. It also evaluates if the limit
established by the law on government's payroll had any
effect on the behavior of Mayors towards this item of the
public budget and if it contributed to reduce the public
spending. This analysis contributes to the empirical
literature of budget rules and public expense and should be
useful for researchers in this field and those interested
in the subject.
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