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Reconsidering The Pros and Cons of Fiscal Policy Co-ordination in a Monetary Union: Should We Set Public Expenditure Targets ?

Author

Listed:
  • Marco Catenaro
  • Patrizio Tirelli

Abstract

We reconsider the merits of fiscal policy co-ordination in a monetary union distinguishing between and inflation targeting regime and delegation to a weight conservative central bank. We argue that a contractualist approach a la Walsh should be extended to the conduct of fiscal policy, setting explicit public expenditure targets.

Suggested Citation

  • Marco Catenaro & Patrizio Tirelli, 2000. "Reconsidering The Pros and Cons of Fiscal Policy Co-ordination in a Monetary Union: Should We Set Public Expenditure Targets ?," School of Economics Discussion Papers 0002, School of Economics, University of Surrey.
    • Handle: RePEc:sur:surrec:0002
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    File URL: https://repec.som.surrey.ac.uk/archive/surrec0002.pdf
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    Citations

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    Cited by:

    1. Jean‐Paul Fitoussi & Francesco Saraceno, 2008. "Fiscal Discipline as a Social Norm: The European Stability Pact," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 10(6), pages 1143-1168, December.
    2. Julia del Amo Valor & Marcos Martín Mateos & Diego Martínez López & Javier J. Pérez, 2023. "Is the European economic governance framework too “complex”? A critical discussion," Working Papers 2023-06, FEDEA.
    3. Jean-Paul Fitoussi & Francesco Saraceno, 2002. "A Theory of Social Custom of Which Soft Growth May Be One Consequence. Tales of the European Stability Pact," SciencePo Working papers Main hal-01065024, HAL.
    4. Francesca Castellani & Xavier Debrun, 2005. "Designing Macroeconomic Frameworks: A Positive Analysis of Monetary and Fiscal Delegation," International Finance, Wiley Blackwell, vol. 8(1), pages 87-117, March.
    5. Ms. Francesca Castellani & Mr. Xavier Debrun, 2001. "Central Bank Independence and the Design of Fiscal Institutions," IMF Working Papers 2001/205, International Monetary Fund.
    6. repec:hal:wpspec:info:hdl:2441/1422 is not listed on IDEAS
    7. Roel Beetsma & Xavier Debrun & Frank Klaassen, 2001. "Is Fiscal Policy Coordination in EMU Desirable?," CESifo Working Paper Series 599, CESifo.
    8. repec:hal:wpspec:info:hdl:2441/9909 is not listed on IDEAS
    9. repec:ebl:ecbull:v:5:y:2008:i:34:p:1-12 is not listed on IDEAS
    10. repec:spo:wpecon:info:hdl:2441/1482 is not listed on IDEAS
    11. repec:hal:spmain:info:hdl:2441/1422 is not listed on IDEAS
    12. repec:spo:wpecon:info:hdl:2441/9909 is not listed on IDEAS
    13. Kilian Bizer & Zulia Gubaydullina & Hazim Rahahleh & Werner Sesselmeier, 2007. "FTPL-Perspective on Tradable Deficit Permits in the EMU," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 35(3), pages 259-267, September.
    14. repec:hal:spmain:info:hdl:2441/1482 is not listed on IDEAS
    15. repec:spo:wpecon:info:hdl:2441/1422 is not listed on IDEAS
    16. repec:hal:wpspec:info:hdl:2441/1482 is not listed on IDEAS
    17. Lossani, Marco & Natale, Piergiovanna & Tirelli, Patrizio, 2001. "A Reform Proposal for EMU Institutions," MPRA Paper 18694, University Library of Munich, Germany.
    18. repec:hal:spmain:info:hdl:2441/9909 is not listed on IDEAS
    19. Cornel Oros, 2008. "Macroeconomic stabilization in a heterogeneous monetary union: some insights into the effects of fiscal policy coordination," Economics Bulletin, AccessEcon, vol. 5(34), pages 1-12.
    20. Francesca Castellani, 2001. "Central Bank Independence and Accountability Under Complete Information," IHEID Working Papers 05-2001, Economics Section, The Graduate Institute of International Studies.

    More about this item

    Keywords

    EMU; Fiscal Leadership; ECB; Fiscal Co-ordination; Inflation Targets;
    All these keywords.

    JEL classification:

    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • F42 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Policy Coordination and Transmission

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