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European Fiscal Compact in Action: Can Independent Fiscal Institutions Deliver Effective Oversight?

Author

Listed:
  • Michal Horvath

    (Department of Economics and Related Studies, University of York)

Abstract

The paper explores if EU independent fiscal institutions (IFIs) are in a position to exercise effective scrutiny over national fiscal policies. It identifies substantial heterogeneity across IFIs in resources which is not matched by a similar diversity in mandates, and highlights the role of local ownership as a potentially important factor in explaining this. In addition to financial and human resources, better access to information, effective comply-or-explain mechanisms and closer links with legislatures could enhance fiscal scrutiny and accountability in the EU. The paper provides rankings of individual IFIs constructed based on measures that quantitatively aggregate these pre-conditions for effective fiscal scrutiny.

Suggested Citation

  • Michal Horvath, 2017. "European Fiscal Compact in Action: Can Independent Fiscal Institutions Deliver Effective Oversight?," Discussion Papers Discussion Paper No. 1/20, Council for Budget Responsibility.
    • Handle: RePEc:cbe:dpaper:201701
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    References listed on IDEAS

    as
    1. Burret, Heiko T. & Schnellenbach, Jan, 2014. "Implementation of the fiscal compact in the Euro area member states: Expertise on the behalf of the German Council of Economic Experts," Working Papers 08/2013e, German Council of Economic Experts / Sachverständigenrat zur Begutachtung der gesamtwirtschaftlichen Entwicklung.
    2. Kukk Merike & Staehr Karsten, 2015. "Enhanced Fiscal Governance in the European Union: The Fiscal Compact," TalTech Journal of European Studies, Sciendo, vol. 5(1), pages 73-92, February.
    3. Graham Bird & Alex Mandilaras, 2013. "Fiscal imbalances and output crises in Europe: will the fiscal compact help or hinder?," Journal of Economic Policy Reform, Taylor and Francis Journals, vol. 16(1), pages 1-16.
    4. Nerlich, Carolin & Reuter, Wolf Heinrich, 2013. "The design of national fiscal frameworks and their budgetary impact," Working Paper Series 1588, European Central Bank.
    5. Graham Bird & Alex Mandilaras, 2013. "Fiscal imbalances and output crises in Europe: will the fiscal compact help or hinder?," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 16(1), pages 1-16, March.
    6. Aldasoro, Iñaki & Faia, Ester, 2014. "The fiscal compact and government debt: One law, multiple statistics," SAFE Policy Letters 22, Leibniz Institute for Financial Research SAFE.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Debrun, Xavier, 2019. "Independent Fiscal Institutions in the European Union: Is Coordination Required?," MPRA Paper 93143, University Library of Munich, Germany.
    2. Asatryan, Zareh & Debrun, Xavier & Heinemann, Friedrich & Horvath, Michal & Ódor, Ľudovít & Yeter, Mustafa, 2017. "Making the most of the European Fiscal Board," ZEW policy briefs 3/2017, ZEW - Leibniz Centre for European Economic Research.

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    More about this item

    Keywords

    Fiscal Compact; European Union; fiscal councils; fiscal policy; democracy;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • F45 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Macroeconomic Issues of Monetary Unions
    • H61 - Public Economics - - National Budget, Deficit, and Debt - - - Budget; Budget Systems
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism

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