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Changes in the fiscal policy of EU states after the 2008 crisis

Author

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  • Wiliński Witold

    (Collegium of World Economy, SGH Warsaw School of Economics, Warsaw, Poland)

Abstract

The aim of this article is an extensive presentation of the fiscal policy conducted by the EU states in the years 2008–2015. The analysis concerns the legal regulations introduced at the EU level by the European Parliament and the Council, as well as the fiscal policies of governments of particular states. The first part of the article analyzes basic macroeconomic data in EU states concerning the level of debt, the level of gross domestic product (GDP) redistribution, and the level of economic growth in the analyzed period. The second part discusses the legal acts adopted by the European Parliament and the Council (the so-called ‘sixpack’ and the European Fiscal Compact), aimed at improving macroeconomic balance and ensuring supervision over the proper functioning of national finances. The third part analyzes the discretionary fiscal policies pursued in EU states. The main conclusions of this article are as follows: (i) EU countries recorded higher national debt levels and debt growth rates between 2008 and 2015 than most non-EU Organisation for Economic Co-operation and Development (OECD) countries; (ii) despite legal measures taken by the European Council and the European Commission in the form of the sixpack and the European Fiscal Compact, and despite discretionary fiscal measures such as in the form of the European Economic Recovery Plan, five EU countries (Cyprus, Greece, Italy, Portugal, and Spain) have experienced a steady increase in their national debt levels; and (iii) deep reforms in the composition and level of government expenditure are a prerequisite for reducing national debt levels and for achieving satisfactory economic growth in these countries.

Suggested Citation

  • Wiliński Witold, 2019. "Changes in the fiscal policy of EU states after the 2008 crisis," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 55(1), pages 52-65, March.
    • Handle: RePEc:vrs:ijomae:v:55:y:2019:i:1:p:52-65:n:4
    DOI: 10.2478/ijme-2019-0004
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    References listed on IDEAS

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    3. Trichet, Jean-Claude, 2013. "International policy coordination in the Euro area: Toward an economic and fiscal federation by exception," Journal of Policy Modeling, Elsevier, vol. 35(3), pages 473-481.
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    More about this item

    JEL classification:

    • H12 - Public Economics - - Structure and Scope of Government - - - Crisis Management
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies

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