IDEAS home Printed from
   My bibliography  Save this paper

EU new member countries: public sector accounts and convergence criteria


  • Giuseppe BOGNETTI


  • Giorgio RAGAZZI



First some general problems concerning the definition and measurement of deficits and public debt are discussed. The rationality of the two Maastricht targets for public finance are also critically analyzed. The economies of six NMCs are then considered, from 2003 onwards. All of them experienced a high and steady rate of growth, but also a relatively high rate of inflation, accelerating after 2006. In spite of a high investment ratio by the public sector, national budget deficits were generally low and below the 3% target. Thanks to the rapid expansion of nominal GNP, the public sector debt ratio declined in all countries, with the only exception of Hungary. Moreover most of them have a positive net financial position. We may thus conclude that these countries (except Hungary) have met the convergence criteria for public sector accounts and have followed prudent fiscal policies: the causes for external imbalances and excessive inflation are to be found (with some exception like the Czech Republic) in lax monetary policies and in the large inflow of foreign capital, primarily for direct investment but also on account of bank lending to the private sector.

Suggested Citation

  • Giuseppe BOGNETTI & Giorgio RAGAZZI, 2009. "EU new member countries: public sector accounts and convergence criteria," Departmental Working Papers 2009-20, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
  • Handle: RePEc:mil:wpdepa:2009-20

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Kocenda, Evzen & Kutan, Ali M. & Yigit, Taner M., 2006. "Pilgrims to the Eurozone: How far, how fast?," Economic Systems, Elsevier, vol. 30(4), pages 311-327, December.
    2. repec:bil:bilpap:0501 is not listed on IDEAS
    3. Vincent Koen & Paul van den Noord, 2005. "Fiscal Gimmickry in Europe: One-Off Measures and Creative Accounting," OECD Economics Department Working Papers 417, OECD Publishing.
    4. William Easterly, 1999. "When is fiscal adjustment an illusion?," Economic Policy, CEPR;CES;MSH, vol. 14(28), pages 55-86, April.
    5. Alfredo Bardozzetti & Sandro Momigliano, 2006. "Le finanze pubbliche dei nuovi Stati membri dell'Unione europea," ECONOMIA PUBBLICA, FrancoAngeli Editore, vol. 2006(5-6), pages 35-63.
    6. Balassone, Fabrizio & Franco, Daniele, 2003. "EMU fiscal rules: a new answer to an old question?," Sede de la CEPAL en Santiago (Estudios e Investigaciones) 34909, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    7. Giorgio Ragazzi, 2002. "Sulla riforma dei conti pubblici," ECONOMIA PUBBLICA, FrancoAngeli Editore, vol. 2002(3).
    8. Giorgio Ragazzi, 2003. "Quali indicatori sintetici per la finanza pubblica?," ECONOMIA PUBBLICA, FrancoAngeli Editore, vol. 2003(4).
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Abdelghani, Echchabi & Osman, Sayid & Isares, Mahamad & Khalid, Sorhiran & Zulhilmi, Zulkifli, 2011. "The implementation of Gulf Dinar among the GCC member countries and its possible impacts," MPRA Paper 28245, University Library of Munich, Germany.

    More about this item


    H62; H63; O52;

    JEL classification:

    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe


    Access and download statistics


    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:mil:wpdepa:2009-20. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (DEMM Working Papers). General contact details of provider: .

    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 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.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.