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Towards a European Constitution: Fiscal Federalism and the Allocation of Economic Competences

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  • Jürgen Stehn
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    Abstract

    The paper analyzes one important aspect of the constitutional debate: the allocation of econornie competences between the EU and the mernber states. It takes the theory of fiscal federalism as a starting point for an optimal allocation of economic competences. The main message of the theory is that a transfer of econornie competences from a lower to a higher political level always leads to a negligence of individual preferences and, therefore, can only be economically justified if national policies cause strong spillovers (externalities) to other jurisdictions. Based on this approach, the paper proposes an allocation of econornic conipetences that can serve as an overall. guideline for a European constitution.

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    File URL: http://www.ifw-members.ifw-kiel.de/publications/towards-a-european-constitution-fiscal-federalism-and-the-allocation-of-economic-competences/kap1125.pdf
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    Bibliographic Info

    Paper provided by Kiel Institute for the World Economy in its series Kiel Working Papers with number 1125.

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    Length: 28 pages
    Date of creation: Aug 2002
    Date of revision:
    Handle: RePEc:kie:kieliw:1125

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    Related research

    Keywords: European constitution; fiscal federalism; allocation of competences;

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    References

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    1. Schuknecht, Ludger & Angeloni, Ignazio & Alesina, Alberto, 2005. "What Does The European Union Do?," Scholarly Articles 4553010, Harvard University Department of Economics.
    2. Alberto Alesina & Ignazio Angeloni & Federico Etro, 2001. "The Political Economy of International Unions," Harvard Institute of Economic Research Working Papers 1939, Harvard - Institute of Economic Research.
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    Cited by:
    1. Massimo Bordignon & Sandro Brusco, 2003. "On Enhanced Cooperation," CESifo Working Paper Series 996, CESifo Group Munich.

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