IDEAS home Printed from https://ideas.repec.org/a/oup/cesifo/v49y2003i3p319-353..html
   My bibliography  Save this article

Fiscal Policy to Stabilise the Domestic Economy in the EMU: What Can We Learn from Monetary Policy?

Author

Listed:
  • Lars Calmfors

Abstract

An important issue for the EMU countries is to what extent fiscal policy can be used to stabilise the domestic economy in the case of asymmetric macroeconomic shocks. The paper reviews possible reforms of national fiscal policy institutions in order to promote efficient fiscal stabilisation policy: (i) the introduction of a more transparent legal framework for the government's stabilisation decisions; (ii) the establishment of an independent advisory Fiscal Policy Council; and (iii) the delegation of actual stabilisation decisions to an independent Fiscal Policy Committee. The conclusion is that the Fiscal Policy Committee solution has much to speak for itself. It seems possible to delegate fiscal stabilisation policy decisions, in much the same way as monetary policy has been delegated to central banks, at the same time as fiscal policy decisions focusing on income distribution and social efficiency are kept in the political sphere. Such delegation can be made compatible with democratic accountability. (JEL E61, E63, P16)

Suggested Citation

  • Lars Calmfors, 2003. "Fiscal Policy to Stabilise the Domestic Economy in the EMU: What Can We Learn from Monetary Policy?," CESifo Economic Studies, CESifo, vol. 49(3), pages 319-353.
  • Handle: RePEc:oup:cesifo:v:49:y:2003:i:3:p:319-353.
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1093/cesifo/49.3.319
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    JEL classification:

    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • E63 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism

    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:oup:cesifo:v:49:y:2003:i:3:p:319-353.. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Oxford University Press) or (Christopher F. Baum). General contact details of provider: http://edirc.repec.org/data/cesifde.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.