The European Fiscal Compact: A Counterfactual Assessment
Faced with the global financial crisis and an increasingly worrisome sovereign-debt crisis, the Eurozone countries are rethinking their fiscal governance. This paper discusses the different reforms and subsequent fiscal rules which have emerged since 2011. It assesses the impact of fiscal rules on the output gap and inflation rate of three representative countries of the Eurozone. By means of a counterfactual, the rules based upon their macroeconomic outcomes are ranked. The new debt reduction rule would certainly lead to lower debt levels, hence to larger fiscal margins for maneuver in the future but, in steep contrast with the golden rule of public finance, it would be very costly to implement as the requirement to enforce a substantial consolidation in the short run would be considerably higher than that of a golden rule and would worsen the output gap and inflation rate. The cap on the cyclically adjusted deficit also leads to unfavorable outcomes whereas the Maastricht status quo, limiting overall public deficit, would be a “second best” behind the golden rule of public finance.
To our knowledge, this item is not available for
download. To find whether it is available, there are three
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Volume (Year): 27 (2012)
Issue (Month): ()
|Contact details of provider:|| Web page: http://econo.sejong.ac.kr/|
More information through EDIRC
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.:
- Andrew Mountford & Harald Uhlig, 2009.
"What are the effects of fiscal policy shocks?,"
Journal of Applied Econometrics,
John Wiley & Sons, Ltd., vol. 24(6), pages 960-992.
- Tom Doan, . "RATS programs to replicate Mountford and Uhlig JAE 2009 sign-constrained VAR," Statistical Software Components RTZ00121, Boston College Department of Economics.
- Andrew Mountford & Harald Uhlig, 2005. "What are the Effects of Fiscal Policy Shocks?," SFB 649 Discussion Papers SFB649DP2005-039, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.
- Andrew Mountford & Harald Uhlig, 2008. "What are the Effects of Fiscal Policy Shocks?," NBER Working Papers 14551, National Bureau of Economic Research, Inc.
- Mountford, Andrew & Uhlig, Harald, 2002. "What are the Effects of Fiscal Policy Shocks?," CEPR Discussion Papers 3338, C.E.P.R. Discussion Papers.
- Jerome Creel & Paul Hubert & Francesco Saraceno, 2012.
"An assessment of Stability and Growth Pact Reform Proposals in a Small-Scale Macro Framework,"
Documents de Travail de l'OFCE
2012-04, Observatoire Francais des Conjonctures Economiques (OFCE).
- Creel, Jérôme & Hubert, Paul & Saraceno, Francesco, 2013. "An assessment of the Stability and Growth Pact reform in a small-scale macro-framework," Journal of Economic Dynamics and Control, Elsevier, vol. 37(8), pages 1567-1580.
- Jérôme Creel & Paul Hubert & Francesco Saraceno, 2012. "An assessment of stability and growth pact reform proposals in a small-scale macro framework," Sciences Po publications 2012-04, Sciences Po.
- Ethan Ilzetzki & Enrique G. Mendoza & Carlos A. VÃ©gh Gramont, 2011.
"How Big (Small?) Are Fiscal Multipliers?,"
IMF Working Papers
11/52, International Monetary Fund.
- Ethan Ilzetzki & Enrique G. Mendoza & Carlos A. Végh, 2010. "How Big (Small?) are Fiscal Multipliers?," CEP Discussion Papers dp1016, Centre for Economic Performance, LSE.
- Ethan Ilzetzki & Enrique G. Mendoza & Carlos A. Végh, 2010. "How Big (Small?) are Fiscal Multipliers?," NBER Working Papers 16479, National Bureau of Economic Research, Inc.
- JÃ©rÃ´me Creel & Paola Monperrus-Veroni & Francesco Saraceno, 2009. "Fiscal policy is back in France and the United Kingdom!," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 31(4), pages 645-667, July.
- Paola Monperrus-Veroni & Francesco Saraceno, 2005.
"Reform of the Stability and Growth Pact: Reducing or Increasing the Nuisance?,"
Documents de Travail de l'OFCE
2005-01, Observatoire Francais des Conjonctures Economiques (OFCE).
- Francesco Saraceno & Paola Veroni, 2005. "Reform of the Stability and Growth Pact: Reducing or Increasing the Nuisance," Sciences Po publications 2005-1, Sciences Po.
- Tobias Knedlik & Gregor von Schweinitz, 2011.
"Macroeconomic Imbalances as Indicators for Debt Crises in Europe,"
IWH Discussion Papers
12, Halle Institute for Economic Research.
- Tobias Knedlik & Gregor Von Schweinitz, 2012. "Macroeconomic Imbalances as Indicators for Debt Crises in Europe," Journal of Common Market Studies, Wiley Blackwell, vol. 50(5), pages 726-745, 09.
- Michael Kumhof & Dirk Muir & Carlos de Resende & Jan in â€˜t Veld & RenÃ© Lalonde & Davide Furceri & Annabelle Mourougane & John Roberts & Stephen Snudden & Mathias Trabandt & GÃ¼nter Coenen & Susanna, 2010.
"Effects of Fiscal Stimulus in Structural Models,"
IMF Working Papers
10/73, International Monetary Fund.
- G�nter Coenen & Christopher J. Erceg & Charles Freedman & Davide Furceri & Michael Kumhof & Ren� Lalonde & Douglas Laxton & Jesper Lind� & Annabelle Mourougane & Dirk Muir & Susanna Mursula & Carlos d, 2012. "Effects of Fiscal Stimulus in Structural Models," American Economic Journal: Macroeconomics, American Economic Association, vol. 4(1), pages 22-68, January.
- Rubinstein, Ariel & Safra, Zvi & Thomson, William, 1992. "On the Interpretation of the Nash Bargaining Solution and Its Extension to Non-expected Utility Preferences," Econometrica, Econometric Society, vol. 60(5), pages 1171-86, September.
- Jérôme Creel & Éric Heyer & Mathieu Plane, 2011.
"Petit précis de politique budgétaire par tous les temps. Les multiplicateurs budgétaires au cours du cycle,"
Revue de l'OFCE,
Presses de Sciences-Po, vol. 0(1), pages 61-88.
- Jérôme Creel & Eric Heyer & Mathieu Plane, 2011. "Petit précis de politique budgétaire par tous les temps : les multiplicateurs budgétaires au cours du cycle," Sciences Po publications info:hdl:2441/5l6uh8ogmqi, Sciences Po.
- Paul De Grauwe, 2006. "What Have we Learnt about Monetary Integration since the Maastricht Treaty?," Journal of Common Market Studies, Wiley Blackwell, vol. 44, pages 711-730, November.
- Charles Wyplosz, 2006. "European Monetary Union: the dark sides of a major success," Economic Policy, CEPR;CES;MSH, vol. 21(46), pages 207-261, 04.
- Jérôme Creel & Francesco Saraceno, 2010. "The Crisis, Automatic Stabilisation, and the Stability Pact," Revista de Economía y Estadística, Universidad Nacional de Córdoba, Facultad de Ciencias Económicas, Instituto de Economía y Finanzas, vol. 0(1), pages 75-103, January.
When requesting a correction, please mention this item's handle: RePEc:ris:integr:0585. 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: (Jong-Eun Lee)
If references are entirely missing, you can add them using this form.