Evaluation of budget flexibility in the budget rules

The state has implemented a regular fiscal policy in order to eliminate the problems faced by the implementation of discretionary fiscal policy. The regulations for the implementation of regular fiscal policy are called fiscal rules. Fiscal rules are classified as revenue, expenditure, borrowing and budget rules according to the fiscal policy instrument. Budget rules refer to written and / or unwritten rules on laws and agreements that must be followed in the numerical and procedural budgeting stages. The purpose of the budget rules is to determine the rules to be followed during the preparation, approval, implementation, supervision and performance evaluation of the budget. However, in practice, the strictness of these rules cannot be changed or certain sanctions are imposed if the rules are not followed, preventing the budget rules from adapting to changes in the economic conjuncture. In order to solve this problem, the concept of budget flexibility has been developed. Budget flexibility refers to the capacity of decision-makers in budgeting to make decisions quickly and effectively by increasing the freedom of decision-making and the diversity of rules in order to produce solutions to non-routine economic problems. The availability of budget flexibility is important to make the economy more stable. However, in the absence of rules, there are several negative effects of budget flexibility on the economy. These effects are due to the release of the decision-making authority of the decision-makers and to increase the diversity of the rules in line with certain interests. It is deemed necessary to implement these two opposite concepts as budget rules and budget flexibility together in order to ensure economic stability. In this study, budget rules and budget elasticity concepts are introduced by using descriptive scanning method and applications related to budget flexibility are examined in the context of the existence of budget rules and certain results are obtained.