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Fiscal Policy and Growth in the Context of European Integration

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  • Paul R Masson

Abstract

The paper considers the issue of whether a supranational fiscal policy in Europe is needed, and, if so, what responsibilities it should undertake. The literature on endogenous growth and the principle of subsidiarity suggest that such a policy should be limited to externalities or economies of scale not captured at the national level. These may include spending on research and development and transportation or knowledge networks, and harmonization of social security designed to enhance labor mobility. EU-wide stabilization policy or enhanced EU redistribution does not seem justified, however.

Suggested Citation

  • Paul R Masson, 2000. "Fiscal Policy and Growth in the Context of European Integration," IMF Working Papers 00/133, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:00/133
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    References listed on IDEAS

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    8. Cecilia Garcia-Penalosa & Eve Caroli & Philippe Aghion, 1999. "Inequality and Economic Growth: The Perspective of the New Growth Theories," Journal of Economic Literature, American Economic Association, vol. 37(4), pages 1615-1660, December.
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    Cited by:

    1. Alberto Majocchi, 2008. "Theories of fiscal federalism and the European experience," ISAE Working Papers 100, ISTAT - Italian National Institute of Statistics - (Rome, ITALY).
    2. Fritz Breuss, 2001. "Towards a Political Economy of Zero Budgeting in Austria," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 28(1), pages 41-67, March.
    3. Hefeker, Carsten, 2003. "Ressourcenverteilung in der EU: Eine polit-ökonomische Perspektive," HWWA Discussion Papers 252, Hamburg Institute of International Economics (HWWA).
    4. Vratislav Izák, 2011. "The Welfare State and Economic Growth," Prague Economic Papers, University of Economics, Prague, vol. 2011(4), pages 291-308.

    More about this item

    Keywords

    European Union; Economic growth; Fiscal policy; Social security; Taxation; fiscal federalism; tax competition; tax rates; fiscal policies; pension; pensions;

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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