rule. From this point forward, therefore, where we refer to budget balance rules, we are referring to structurally / cyclically adjusted rules. In parallel with the scoring in tables 4.2 and 4.2 of each rule against each criterion as either poor, partial, moderate or high, figure 4.1 represents this scoring visually, with a lighter shade for a lower score, and a deeper shade for a higher score. As can be seen from figure 4.1 below, debt and budget balance rules tend to score more highly on economic effectiveness and transparency, simplicity and accountability criteria. This is a reflection of expenditure rules being something of a blunt instrument, yet one that is relatively straightforward to implement and to understand for the public. Budget balance rules, on the other hand, score more highly on economic grounds than on the openness categories. They are necessarily complex, to accommodate fluctuating cycles, but this complexity compromises their transparency. Debt rules are the single best measure of net position, and for this reason alone should be included in any combination. Their greatest weakness if their pro-cyclicality and lack of flexibility; however, the chart assumes no cyclical adjustment in this target, as is the norm, but the authors note that adding cyclical features in debt rule design may overcome some of the most severe shortcomings.
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