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The End of the Stability and Growth Pact?

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Author Info
Jakob de Haan ()
Helge Berger ()
David-Jan Jansen ()

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Abstract

This paper evaluates the Stability and Growth Pact. After examining the rules in place and the experience so far, the Pact is analysed from a political economy perspective, focusing on the choice for so-called soft law and drawing inferences from characteristics of successful fiscal rules at the state level in the United States. It is also examined whether big and small countries are likely to adhere to fiscal policy rules in place. Furthermore, the impact of the business cycle on fiscal policy outcomes is analysed. Finally, the proposals of the European Commission to strengthen the Pact are discussed.

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Publisher Info
Paper provided by CESifo GmbH in its series CESifo Working Paper Series with number CESifo Working Paper No. 1093.

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Date of creation: 2003
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Handle: RePEc:ces:ceswps:_1093

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Related research
Keywords: Stability and Growth Pact EMU budget discipline

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This paper has been announced in the following NEP Reports: References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Jordi GalÌ & Roberto Perotti, 2003. "Fiscal policy and monetary integration in Europe," Economic Policy, CEPR, CES, MSH, vol. 18(37), pages 533-572, October. [Downloadable!] (restricted)
    Other versions:
  2. Artis, Michael J & Zhang, Wenda, 1999. "Further Evidence on the International Business Cycle and the ERM: Is There a European Business Cycle?," Oxford Economic Papers, Oxford University Press, vol. 51(1), pages 120-32, January.
  3. Barrell, R. & Pina, A.M., 2000. "How Important are Automatic Stabilizers in Europe? A Stochastic Simulation Assessment," Economics Working Papers eco2000/2, European University Institute.
    Other versions:
  4. Marco Buti & Paul van den Noord, 2003. "Discretionary Fiscal Policy and Elections: The Experience of the Early Years of EMU," OECD Economics Department Working Papers 351, OECD Economics Department. [Downloadable!]
  5. Frankel, Jeffrey A & Rose, Andrew K, 1998. "The Endogeneity of the Optimum Currency Area Criteria," Economic Journal, Royal Economic Society, vol. 108(449), pages 1009-25, July. [Downloadable!] (restricted)
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  6. Thomas Dalsgaard & Alain de Serres, 1999. "Estimating Prudent Budgetary Margins for 11 EU Countries: A Simulated SVAR Model Approach," OECD Economics Department Working Papers 216, OECD Economics Department. [Downloadable!]
  7. Buti, Marco & Eijffinger, Sylvester C W & Franco, Daniele, 2003. "Revisiting the Stability and Growth Pact: Grand Design or Internal Adjustment?," CEPR Discussion Papers 3692, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  8. Inklaar, Robert & de Haan, Jakob, 2001. "Is There Really a European Business Cycle? A Comment," Oxford Economic Papers, Oxford University Press, vol. 53(2), pages 215-20, April.
  9. Dermot Hodson & Imelda Maher, 2001. "The Open Method as a New Mode of Governance: The Case of Soft Economic Policy Co-ordination," Journal of Common Market Studies, Blackwell Publishing, vol. 39(4), pages 719-746, November. [Downloadable!] (restricted)
  10. Barry Eichengreen & Charles Wyplosz, 1998. "The Stability Pact: more than a minor nuisance?," Economic Policy, CEPR, CES, MSH, vol. 13(26), pages 65-113, 04. [Downloadable!] (restricted)
  11. A.J. Hughes Hallett & Peter McAdam, 2003. "Deficit Targeting Strategies: Fiscal Consolidation and the Probability Distribution of Deficits under the Stability Pact," Journal of Common Market Studies, Blackwell Publishing, vol. 41(3), pages 421-444, 06. [Downloadable!] (restricted)
  12. Albert Jaeger & Ludger Schuknecht, 2004. "Boom-Bust Phases in Asset Prices and Fiscal Policy Behavior," IMF Working Papers 04/54, International Monetary Fund. [Downloadable!]
    Other versions:
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Renate Ohr & André Schmidt, 2006. "Handelbare Verschuldungsrechte zur Sicherung fiskalischer Stabilität in der Währungsunion?," Departmental Discussion Papers 128, University of Goettingen, Department of Economics. [Downloadable!]
  2. Ludger Schuknecht, 2004. "EU fiscal rules: issues and lessons from political economy," Working Paper Series 421, European Central Bank. [Downloadable!]
  3. Candelon Bertrand & Muysken Joan & Vermeulen Robert, 2007. "Fiscal Policy and Monetary Integration in Europe: An Update," Research Memoranda 050, Maastricht : METEOR, Maastricht Research School of Economics of Technology and Organization. [Downloadable!]
  4. John P. Jackson & Mark J. Manning, 2007. "Central Bank intraday collateral policy and implications for tiering in rtgs payment systems," DNB Working Papers 129, Netherlands Central Bank, Research Department. [Downloadable!]
  5. Andrew Hughes Hallett & Rasmus Kattai & John Lewis, 2007. "Early warning or just wise after the event? The problem of using cyclically adjusted budget deficits for fiscal surveillance," Bank of Estonia Working Papers 2007-02, Bank of Estonia, revised 09 Feb 2007. [Downloadable!]
    Other versions:
  6. Bodo Herzog, 2004. "Warum verstoßen vorwiegend die großen EWU-Länder gegen den Stabilitäts- und Wachstumspakt? : Eine theoretische Beweisaufnahme," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 73(3), pages 405-417. [Downloadable!] (restricted)
  7. Anthony Annett, 2006. "Enforcement and the Stability and Growth Pact: How Fiscal Policy Did and Did Not Change Under Europe's Fiscal Framework," IMF Working Papers 06/116, International Monetary Fund. [Downloadable!]
  8. Andrew Hughes Hallet & Rasmus Kattai & John Lewis, 2007. "Early Warning or Just Wise After the Event?," DNB Working Papers 124, Netherlands Central Bank, Research Department. [Downloadable!]
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