IDEAS home Printed from https://ideas.repec.org/a/bla/jcmkts/v46y2008i5p933-968.html

The Economic Effects of the EU Budget: A VAR Analysis

Author

Listed:
  • PIERFEDERICO ASDRUBALI
  • SOYOUNG KIM

Abstract

This article analyses the allocation, redistribution and stabilization role of the EU budget from 1976 to 2001. We use impulse responses from VAR models to infer the dynamic effect of a country's GNP on its disposable income – defined as GNP plus net EU budget transfers – both in the short run (stabilization) and in the long run (redistribution). In addition, we measure the allocation role of net budget transfers through their ‘dynamic multiplier’ effect on a country's GNP, circumventing the difficult task of estimating allocation via costs and benefits of trade flows. By disaggregating our data by sub‐period and by budget component, we discover how diverse the above effects can be in different decades, for different budget programmes and for different Member States. Finally, our framework allows us to establish some additional stylized facts that help derive relevant economic relations and useful policy conclusions.

Suggested Citation

  • Pierfederico Asdrubali & Soyoung Kim, 2008. "The Economic Effects of the EU Budget: A VAR Analysis," Journal of Common Market Studies, Wiley Blackwell, vol. 46(5), pages 933-968, December.
    • Handle: RePEc:bla:jcmkts:v:46:y:2008:i:5:p:933-968
    DOI: 10.1111/j.1468-5965.2008.00825.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1468-5965.2008.00825.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1468-5965.2008.00825.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Mara Giua & Filippo Maria Pericoli & Eleonora Pierucci, 2024. "EU Cohesion Policy and Inter‐regional Risk‐sharing: First Evidence and Lessons Learned," Journal of Common Market Studies, Wiley Blackwell, vol. 62(1), pages 142-167, January.
    2. Tsai-Yuan Huang & Po-Chin Wu & Ching-Wen Yan, 2014. "Revisiting the redistribution effects of intergovernmental fiscal transfers: evidence from Taiwan," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 17(4), pages 341-359, December.
    3. Asdrubali, Pierfederico & Kim, Soyoung & Pericoli, Filippo Maria & Poncela, Pilar, 2023. "Risk sharing channels in OECD countries: A heterogeneous panel VAR approach," Journal of International Money and Finance, Elsevier, vol. 131(C).
    4. Gagnon, Marie-Hélène & Gimet, Céline, 2013. "The impacts of standard monetary and budgetary policies on liquidity and financial markets: International evidence from the credit freeze crisis," Journal of Banking & Finance, Elsevier, vol. 37(11), pages 4599-4614.
    5. Paolo Pasimeni & Stéphanie Riso, 2019. "Redistribution and stabilisation through the EU budget," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 36(1), pages 111-138, April.
    6. Paolo Pasimeni & Stéphanie Riso, 2016. "The redistributive function of the EU budget," IMK Working Paper 174-2016, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.

    More about this item

    JEL classification:

    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:jcmkts:v:46:y:2008:i:5:p:933-968. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0021-9886 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.