IDEAS home Printed from https://ideas.repec.org/h/spr/spbchp/978-3-319-00020-6_2.html
   My bibliography  Save this book chapter

The Economic Rationale of Fiscal Rules in OCAs: The Stability and Growth Pact and the Excessive Deficit Procedure

In: The Economics of the Monetary Union and the Eurozone Crisis

Author

Listed:
  • Manuel Sanchis i Marco

    (University of Valencia)

Abstract

This chapter examines the case of different regions within a single country that wish to share a common currency, even though they have divergent trends in unemployment, inflation, wages, non-wage costs and productivity. This situation compares with the case of a group of EU countries, each with its own decentralised national budget, that have established a monetary union and that are facing asymmetric shocks. As such an economic context requires fiscal commitments from national governments, we analyse the economic rationale of setting fiscal rules for a common currency area and the resulting EU institutional frame for the Stability and Growth Pact (SGP) and the Excessive Deficit Procedure (EDP). We discuss the legal basis for the EDP and the relevant accounting definitions. We also provide the initial settings of the SGP, as well as a summary of the contents and the related assessment of the revised SPG in March 2005. The chapter concludes with a brief comment on the so-called “Six Pack” adopted by the EU in December 2011, which provides a wide range of macroeconomic indicators to improve the governance of EMU within Eurozone countries, through the Surveillance of Macroeconomic Imbalance Procedure.

Suggested Citation

  • Manuel Sanchis i Marco, 2014. "The Economic Rationale of Fiscal Rules in OCAs: The Stability and Growth Pact and the Excessive Deficit Procedure," SpringerBriefs in Economics, in: The Economics of the Monetary Union and the Eurozone Crisis, edition 127, chapter 0, pages 13-28, Springer.
    • Handle: RePEc:spr:spbchp:978-3-319-00020-6_2
    DOI: 10.1007/978-3-319-00020-6_2
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below 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.

    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:spr:spbchp:978-3-319-00020-6_2. 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    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.