Schuldenbremse: Bisherige Beschlüsse stellen Gelingen auf Länderebene infrage
AbstractStarting in 2011, Germany will have a new fiscal rule to limit indebtedness - the debt brake. To encourage the functioning of this regulation on federal and Länder level, an advice board (Stabilitätsrat) was founded in April 2010. In a first step he selected four key numbers and defined thresholds. This article focuses on the chosen indicators and thresholds on Länder level by evaluating the effectiveness of both, the key figures themselves and their thresholds. We are analyzing time series from 1995 to 2009. The findings show that in general, the chosen figures are able to indicate a possible debt risk. However, the threshold values of the advice board endanger the effectiveness of the debt brake. This danger is especially caused by the mode of calculation: The thresholds are based on an average of German Länder. For this reason, only extremely negative household developments are pointed out. Furthermore, the new German debt brake is fundamentally based on the structural budget balance. Nevertheless, this key figure has not directly been chosen by the board. The approach of the board can be explained by the fact that there is - so far - no agreement between the federal level and the Länder how to calculate the structural balance on the Länder level. This circumstance is precarious, because the debt brake cannot step really into force without the calculation of the structural budget balance for the Länder. For this reason, we try to close this vacancy by proposing a possible calculating mode for the structural part of the budget. The results of this calculation are indicating that on average the fiscal policy of the Länder was not sustainable. Key numbers as defined by the board indicated this only for a few of the Länder. From our point of view policy urgently has to act – otherwise the debt brake might not be successful.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Halle Institute for Economic Research in its journal Wirtschaft im Wandel.
Volume (Year): 16 (2010)
Issue (Month): 9 ()
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Oliver Holtemöller & Maike Irrek & Birgit Schultz, 2012. "A Federal Long-run Projection Model for Germany," IWH Discussion Papers 11, Halle Institute for Economic Research.
- Hetschko, Clemens & Quint, Dominic & Thye, Marius, 2012. "Nationale Schuldenbremsen für die Länder der Europäischen Union: Taugt das deutsche Modell als Vorbild?," Discussion Papers 2012/12, Free University Berlin, School of Business & Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Tobias Henning).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.