IDEAS home Printed from https://ideas.repec.org/p/imf/imfwpa/2015-067.html
   My bibliography  Save this paper

Playing by the Rules: Reforming Fiscal Governance in Europe

Author

Listed:
  • Mr. Luc Eyraud
  • Mr. Tao Wu

Abstract

The paper contributes to the discussions on fiscal governance in Europe. It takes stock of recent reforms, identifies areas for further progress, and discusses a menu of policy options for the medium-term. The issues covered include: (i) the growing complexity of the European framework and ways to simplify it; (ii) the difficulties to measure and implement structural stance indicators; (iii) the challenge of reconciling fiscal sustainability and growth; (iv) the need to enhance coordination in the area of monitoring; and (v) the obstacles to compliance and proposals to strengthen enforcement.

Suggested Citation

  • Mr. Luc Eyraud & Mr. Tao Wu, 2015. "Playing by the Rules: Reforming Fiscal Governance in Europe," IMF Working Papers 2015/067, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2015/067
    as

    Download full text from publisher

    File URL: http://www.imf.org/external/pubs/cat/longres.aspx?sk=42804
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Douglas Sutherland & Robert Price & Isabelle Joumard, 2006. "Sub-central government fiscal rules," OECD Economic Studies, OECD Publishing, vol. 2005(2), pages 141-181.
    2. Lars Calmfors & Simon Wren-Lewis, 2011. "What should fiscal councils do? [Fiscal policy when monetary policy is tied to the mast]," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 26(68), pages 649-695.
    3. Roel M. W. J. Beetsma & Xavier Debrun, 2004. "Reconciling Stability and Growth: Smart Pacts and Structural Reforms," IMF Staff Papers, Palgrave Macmillan, vol. 51(3), pages 431-456, November.
    4. Servaas Deroose & Martin Larch & Andrea Schachter, 2011. "Constricted, lame and pro-cyclical? Fiscal policy in the euro area revisited," International Journal of Sustainable Economy, Inderscience Enterprises Ltd, vol. 3(2), pages 162-184.
    5. Mr. Julio Escolano, 2010. "A Practical Guide to Public Debt Dynamics, Fiscal Sustainability, and Cyclical Adjustment of Budgetary Aggregates," IMF Technical Notes and Manuals 2010/002, International Monetary Fund.
    6. Galí, Jordi & Perotti, Roberto, 2003. "Fiscal Policy and Monetary Integration in Europe," CEPR Discussion Papers 3933, C.E.P.R. Discussion Papers.
    7. Astrid Lemmer & Dan Stegarescu, 2009. "Revenue windfalls and expenditure slippages: Disappointing implementation of the reformed stability and growth pact," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 44(3), pages 159-165, May.
    8. Jacopo Cimadomo, 2005. "Has the Stability and Growth Pact Made Fiscal Policy More Pro-Cyclical?," La Lettre du CEPII, CEPII research center, issue 247.
    9. International Monetary Fund, 2010. "Estimating Potential Output with a Multivariate Filter," IMF Working Papers 2010/285, International Monetary Fund.
    10. Kempkes, Gerhard, 2012. "Cyclical adjustment in fiscal rules: Some evidence on real-time bias for EU-15 countries," Discussion Papers 15/2012, Deutsche Bundesbank.
    11. Mr. Mike Seiferling, 2013. "Stock-Flow Adjustments, Government’s Integrated Balance Sheet and Fiscal Transparency," IMF Working Papers 2013/063, International Monetary Fund.
    12. Francesca D'Auria & Cécile Denis & Karel Havik & Kieran Mc Morrow & Christophe Planas & Rafal Raciborski & Werner Roger & Alessandro Rossi, 2010. "The production function methodology for calculating potential growth rates and output gaps," European Economy - Economic Papers 2008 - 2015 420, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    13. Fabian Bornhorst & Annalisa Fedelino & Jan Gottschalk & Gabriela Dobrescu, 2011. "When and How to Adjust Beyond the Business Cycle? A Guide to Structural Fiscal Balances," IMF Technical Notes and Manuals 11/02, International Monetary Fund.
    14. Bergljot B Barkbu & Jesmin Rahman & Rodrigo O. Valdes, 2012. "Fostering Growth in Europe Now," IMF Staff Discussion Notes 12/07, International Monetary Fund.
    15. Jens Høj & Vincenzo Galasso & Giuseppe Nicoletti & Thai-Thanh Dang, 2007. "An empirical investigaton of political economy factors behind structural reforms in OECD countries," OECD Economic Studies, OECD Publishing, vol. 2006(1), pages 87-136.
    16. Ran Bi & Mr. Haonan Qu & Mr. James Roaf, 2013. "Assessing the Impact and Phasing of Multi-year Fiscal Adjustment: A General Framework," IMF Working Papers 2013/182, International Monetary Fund.
    17. Isabelle Joumard & Per Mathis Kongsrud, 2003. "Fiscal Relations across Government Levels," OECD Economic Studies, OECD Publishing, vol. 2003(1), pages 155-229.
    18. Nicolas Carnot, 2014. "Evaluating Fiscal Policy: A Rule of Thumb," European Economy - Economic Papers 2008 - 2015 526, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    19. Fabian Bornhorst & Ms. Annalisa Fedelino & Jan Gottschalk & Miss Gabriela Dobrescu, 2011. "When and How to Adjust Beyond the Business Cycle? A Guide to Structural Fiscal Balances," IMF Technical Notes and Manuals 2011/002, International Monetary Fund.
    20. Mr. Steven A. Symansky & Mr. Xavier Debrun & Mr. Natan P. Epstein, 2008. "A New Fiscal Rule: Should Israel “Go Swiss?”," IMF Working Papers 2008/087, International Monetary Fund.
    21. Julio Escolano, 2010. "A Practical Guide to Public Debt Dynamics, Fiscal Sustainability, and Cyclical Adjustment of Budgetary Aggregates," IMF Technical Notes and Manuals 10/02, International Monetary Fund.
    22. Jordi Galí & Roberto Perotti, 2003. "Fiscal policy and monetary integration in Europe [‘Consumption smoothing through fiscal policy in OECD and EU countries’]," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 18(37), pages 533-572.
    23. Olivier J Blanchard & Giovanni Dell'Ariccia & Paolo Mauro, 2013. "Rethinking Macro Policy II; Getting Granular," IMF Staff Discussion Notes 13/003, International Monetary Fund.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. International Monetary Fund, 2014. "Euro Area Policies: Selected Issues," IMF Staff Country Reports 2014/199, International Monetary Fund.
    2. Auerbach, Alan J & Gorodnichenko, Yuriy, 2017. "Fiscal Stimulus and Fiscal Sustainability," Department of Economics, Working Paper Series qt90t9q1mx, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
    3. Mr. Alexander D Klemm, 2014. "Fiscal Policy in Latin America over the Cycle," IMF Working Papers 2014/059, International Monetary Fund.
    4. Kose, M. Ayhan & Kurlat, Sergio & Ohnsorge, Franziska & Sugawara, Naotaka, 2022. "A cross-country database of fiscal space," Journal of International Money and Finance, Elsevier, vol. 128(C).
    5. Kai Liu, 2014. "Public Finances, Business Cycles and Structural Fiscal Balances," Cambridge Working Papers in Economics 1411, Faculty of Economics, University of Cambridge.
    6. Luc Eyraud & Xavier Debrun & Andrew Hodge & Victor Duarte Lledo & Catherine A Pattillo, 2018. "Second-Generation Fiscal Rules; Balancing Simplicity, Flexibility, and Enforceability," IMF Staff Discussion Notes 18/04, International Monetary Fund.
    7. Virkola, Tuomo, 2014. "Real-Time Measures of the Output Gap and Fiscal Policy Stance," ETLA Reports 37, The Research Institute of the Finnish Economy.
    8. Tagkalakis, Athanasios O., 2014. "Financial stability indicators and public debt developments," The Quarterly Review of Economics and Finance, Elsevier, vol. 54(2), pages 158-179.
    9. Klaus Vondra, 2013. "Austria Withstands Recession: Return to Positive Growth in Early 2013," Monetary Policy & the Economy, Oesterreichische Nationalbank (Austrian Central Bank), issue 1, pages 6-11.
    10. Agnello, Luca & Castro, Vítor & Sousa, Ricardo M., 2023. "A quest between fiscal and market discipline," Economic Modelling, Elsevier, vol. 119(C).
    11. Étienne Farvaque & Martial Foucault & Marcelin Joanis, 2015. "L’endettement public des provinces canadiennes : Les règles d’équilibre budgétaire sont-elles efficaces?," CIRANO Working Papers 2015s-10, CIRANO.
    12. Ricci-Risquete, Alejandro & Ramajo, Julián & de Castro, Francisco, 2016. "Do Spanish fiscal regimes follow the euro-area trends? Evidence from Markov-Switching fiscal rules," Economic Modelling, Elsevier, vol. 59(C), pages 484-494.
    13. Douglas Sutherland & Peter Hoeller & Balázs Égert & Oliver Röhn, 2010. "Counter-cyclical Economic Policy," OECD Economics Department Working Papers 760, OECD Publishing.
    14. Hans Pitlik & Michael Klien & Stefan Schiman-Vukan, 2017. "Stabilitätskonforme Berücksichtigung nachhaltiger öffentlicher Investitionen," WIFO Studies, WIFO, number 60595, April.
    15. Combes, Jean-Louis & Minea, Alexandru & Sow, Moussé, 2017. "Is fiscal policy always counter- (pro-) cyclical? The role of public debt and fiscal rules," Economic Modelling, Elsevier, vol. 65(C), pages 138-146.
    16. Proaño, Christian R. & Lojak, Benjamin, 2021. "Monetary Policy with a State-Dependent Inflation Target in a Behavioral Two-Country Monetary Union Model," Journal of Economic Dynamics and Control, Elsevier, vol. 133(C).
    17. Xavier Debrun & David Hauner & Manmohan S. Kumar, 2009. "Independent Fiscal Agencies," Journal of Economic Surveys, Wiley Blackwell, vol. 23(1), pages 44-81, February.
    18. Hughes Hallett, Andrew & Bernoth, Kerstin & Lewis, John, 2008. "Did Fiscal Policy Makers Know What They Were Doing? Reassessing Fiscal Policy with Real Time Data," CEPR Discussion Papers 6758, C.E.P.R. Discussion Papers.
    19. Bernoth, Kerstin & Hughes Hallett, Andrew & Lewis, John, 2008. "Did Fiscal Policy Makers Know What They Were Doing? Reassessing Fiscal Policy with Real Time Data," CEPR Discussion Papers 6758, C.E.P.R. Discussion Papers.
    20. Marek Lubiński, 2011. "Przyszłość paktu stabilności i wzrostu," Gospodarka Narodowa. The Polish Journal of Economics, Warsaw School of Economics, issue 1-2, pages 19-42.

    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:imf:imfwpa:2015/067. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Akshay Modi (email available below). General contact details of provider: https://edirc.repec.org/data/imfffus.html .

    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.