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Fiscal Expectations on the Stability and Growth Pact: Evidence from Survey Data

Author

Listed:
  • Marcos Poplawski-Ribeiro
  • Jan-Christoph Rülke

Abstract

The paper uses survey data to analyze whether the Stability and Growth Pact (SGP) has changed financial market’s expectations on government budget deficits in France, Germany, Italy, and the UK. Our findings indicate that accuracy of financial experts’ deficit forecasts has increased in France during the SGP. The Pact seems to have also promoted a gain in credibility of European Commission’s deficit forecasts in France, Italy, and in the UK, particularly after its reform in 2005 and up to December 2007. Nevertheless, the National Fiscal Authorities’ forecasts of France, Germany, and Italy seem to have not been credible among market experts during the SGP. These results suggest that additional measures could be taken in order to make the fiscal rules of the Pact more credible among market specialists.

Suggested Citation

  • Marcos Poplawski-Ribeiro & Jan-Christoph Rülke, 2010. "Fiscal Expectations on the Stability and Growth Pact: Evidence from Survey Data," Working Papers 2010-05, CEPII research center.
    • Handle: RePEc:cii:cepidt:2010-05
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    References listed on IDEAS

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    Cited by:

    1. Merola, Rossana & Pérez, Javier J., 2013. "Fiscal forecast errors: Governments versus independent agencies?," European Journal of Political Economy, Elsevier, vol. 32(C), pages 285-299.
    2. Rossana Merola & Javier J. Pérez, 2012. "Fiscal forecast errors: governments vs independent agencies?," Working Papers 1233, Banco de España.

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    Keywords

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    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus

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