Determinants of fiscal budget volatility in old versus new EU member states
AbstractIn this study we perform an analysis of the volatility of the budget deficit for EU countries. We address this issue starting from the new requirements of fiscal discipline imposed by the Treaty on Stability, Coordination and Governance adopted by 25 European Union member states and taking into account the economic crisis impact. The major purpose of this study is to identify the most significant determinants of budget deficit volatility in a comparative study for old EU member states and New Member States (NMS). This study aims to test the impact of macroeconomic variables such as public expenditures, economic growth rate, and unemployment on the budget balance volatility, based on panel data. The final purpose of the article is to reveal the strategies to stop the immense increase in fiscal deficits and to regain fiscal stability to fulfill the new rules of fiscal governance. We anticipate that the implementation of this new fiscal discipline requires a more efficient public sector for both old and NMS and a reconsideration of state intervention in the economy.
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 InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 42555.
Date of creation: Sep 2012
Date of revision:
budget deficit; fiscal policy; economic growth;
Other versions of this item:
- Eugenia-Ramona Mara, 2012. "Determinants of fiscal budget volatility in old versus new EU member states," Working Papers Department of Economics 2012/31, ISEG - School of Economics and Management, Department of Economics, University of Lisbon.
- H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus
- E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
- E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
- H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-11-24 (All new papers)
- NEP-EEC-2012-11-24 (European Economics)
- NEP-FDG-2012-11-24 (Financial Development & Growth)
- NEP-PBE-2012-11-24 (Public Economics)
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.:
- António Afonso & Davide Furceri, 2008.
"Government Size, Composition, Volatility and Economic Growth,"
Working Papers Department of Economics
2008/04, ISEG - School of Economics and Management, Department of Economics, University of Lisbon.
- Afonso, António & Furceri, Davide, 2010. "Government size, composition, volatility and economic growth," European Journal of Political Economy, Elsevier, vol. 26(4), pages 517-532, December.
- Afonso, António & Furceri, Davide, 2008. "Government size, composition, volatility and economic growth," Working Paper Series 0849, European Central Bank.
- Ant�nio Afonso & Jo�o Tovar Jalles, 2012.
"Fiscal volatility, financial crises and growth,"
Applied Economics Letters,
Taylor & Francis Journals, vol. 19(18), pages 1821-1826, December.
- Roubini, Nouriel & Sachs, Jeffrey D., 1989. "Political and economic determinants of budget deficits in the industrial democracies," European Economic Review, Elsevier, vol. 33(5), pages 903-933, May.
- Agnello, Luca & Sousa, Ricardo M., 2009.
"The determinants of public deficit volatility,"
Working Paper Series
1042, European Central Bank.
- Castro, Vítor, 2007.
"The Causes of Excessive Deficits in The European Union,"
The Warwick Economics Research Paper Series (TWERPS)
805, University of Warwick, Department of Economics.
- Vítor Castro, 2007. "The Causes of Excessive Deficits in the European Union," NIPE Working Papers 13/2007, NIPE - Universidade do Minho.
- Dybczak, Kamil & Melecky, Martin, 2012. "EU Fiscal Stance Vulnerability: Are the Old Members the Gold Members?," MPRA Paper 42837, University Library of Munich, Germany.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht).
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.