World Bank economists use a variety of methodologies to diagnose and address the constraints to efficient and effective public finance. Economists use a range of tools to do these analyses. Some of them are listed below:
· Public Expenditure Reviews (PERs): This core diagnostic looks at the optimal allocation of public resources – that is, how should the government allocate its limited money so as to maximize economic growth and poverty reduction? There are many ways of analyzing the efficiency and equity of public spending, which is why there is substantial variation in the content of and approaches adopted by different PERs.
· Policy Notes: This approach tackles individual and unique fiscal challenges at the country level, often through dedicated and tailored analyses.
· BOOST: This initiative is a Bank-wide collaborative effort launched in 2010 to facilitate access to budget data and promote effective use for improved decision-making processes, transparency and accountability.
· Fiscal and Debt Sustainability Analyses: There are several techniques including both deterministic and stochastic frameworks for assessing the sustainability of current and expected policies. This framework also addresses the types and consequences of policy adjustments needed to manage solvency and liquidity risks.
· Public Expenditure and Financial Accountability (PEFA): The PEFA Program is a multi-donor partnership between seven donor agencies and international financial institutions working to strengthen recipient and donor ability to (i) assess the condition of country public expenditure, procurement and financial accountability systems, and (ii) develop a practical sequence of reform and capacity-building actions.