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The impact of Fiscal Rules on Government Debt: Evidence from the CFA Zone.

Abstract. This paper uses the synthetic control method (SCM) to estimate the effect of adopting numerical fiscal rules on the debt-to-GDP ratio of CFA zone countries. Using the SCM, allows to address the self-selection bias issue that has plagued previous studies on the impact of fiscal rules. The SCM compares the post treatment trajectory of the treated CFA zone countries to that of a counterfactual constructed using similar but untreated donor countries. Our results...