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The politics of fiscal effort in Spain and Ireland: Market credibility versus political legitimacy

Author

Listed:
  • Sebastian Dellepiane

    (School of Government and Public Policy University of Strathclyde)

  • Niamh Hardiman

    (School of Politics and International Relations University College Dublin)

Abstract

Austerity measures in response to Eurozone crisis have tended to be conceived, debated, and implemented as if only the technical parameters of budget management mattered. But policies that impose budgetary hardships on citizens, whether in the form of increased taxes or cuts to public spending go right to the heart of voter expectations about what it is both appropriate and acceptable for governments to do. Pro-cyclical measures that worsen an already difficult situation in a recession run counter to deep-seated norms and expectations in European countries, built up over decades of democratic governance, whereby governments are expected to provide offsetting protection for their citizens against the vicissitudes of the market. If austerity measures are held to be unavoidable in response to market turbulence, and especially if this view is underwritten by international authorities, new challenges of political legitimation are likely to arise. These issues are explored through the experiences of Spain and Ireland.

Suggested Citation

  • Sebastian Dellepiane & Niamh Hardiman, 2013. "The politics of fiscal effort in Spain and Ireland: Market credibility versus political legitimacy," Working Papers 201321, Geary Institute, University College Dublin.
  • Handle: RePEc:ucd:wpaper:201321
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    File URL: http://www.ucd.ie/geary/static/publications/workingpapers/gearywp201321.pdf
    File Function: First version, 2013
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    References listed on IDEAS

    as
    1. Sebastian Dellepiane & Niamh Hardiman, 2012. "The New Politics of Austerity: Fiscal Responses to the Economic Crisis in Ireland and Spain," Working Papers 201207, Geary Institute, University College Dublin.
    2. Callan,Tim & Keane,Claire & Savage,Michael & Walsh,John R., 2012. "Distributional Impact of Tax, Welfare and Public Sector Pay Policies: 2009-2012," Quarterly Economic Commentary: Special Articles, Economic and Social Research Institute (ESRI), vol. 2012(4-Winter ).
    3. Sebastian Dellepiane Avellaneda & Niamh Hardiman, 2010. "The European Context of Ireland’s Economic Crisis," The Economic and Social Review, Economic and Social Studies, vol. 41(4), pages 473-500.
    4. McGuinness, Seamus & Kelly, Elish & O'Connell, Philip J., 2010. "The Impact of Social Partnership on Ireland's Competitiveness," Papers RB2010/3/3, Economic and Social Research Institute (ESRI).
    5. Culpepper, Pepper D., 2008. "The Politics of Common Knowledge: Ideas and Institutional Change in Wage Bargaining," International Organization, Cambridge University Press, vol. 62(01), pages 1-33, January.
    6. Karl Whelan, 2012. "ELA, Promissory Notes and All That:The Fiscal Costs of Anglo Irish Bank," The Economic and Social Review, Economic and Social Studies, vol. 43(4), pages 653-673.
    7. Sebastian Dellepiane & Niamh Hardiman, 2011. "Governing the Irish Economy: A Triple Crisis," Working Papers 201103, Geary Institute, University College Dublin.
    8. Blánaid Clarke & Niamh Hardiman, 2012. "Crisis in the Irish Banking System," Working Papers 201203, Geary Institute, University College Dublin.
    9. Roche, William K., 2009. "Social Partnership - From Lemass to Cowen," The Economic and Social Review, Economic and Social Studies, vol. 40(2), pages 183-205.
    10. Rodrik, Dani, 2012. "The Globalization Paradox: Why Global Markets, States, and Democracy Can't Coexist," OUP Catalogue, Oxford University Press, number 9780199652525.
    11. Blyth, Mark, 2013. "Austerity: The History of a Dangerous Idea," OUP Catalogue, Oxford University Press, number 9780199828302.
    12. von Hagen, Jurgen & Strauch, Rolf R, 2001. "Fiscal Consolidations: Quality, Economic Conditions, and Success," Public Choice, Springer, vol. 109(3-4), pages 327-346, December.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Michelle Norris & Michael Byrne, 2016. "Social housing's role in the Irish property boom and bust," Working Papers 201615, Geary Institute, University College Dublin.
    2. Niamh Hardiman & Spyros Blavoukos & Sebastian Dellepiane-Avellaneda & George Pagoulatos, 2016. "Austerity in the European periphery: the Irish experience," Working Papers 201604, Geary Institute, University College Dublin.
    3. João Veríssimo LISBOA & Mário Gomes AUGUSTO & Juan PIÑEIRO-CHOUSA, 2015. "A Combined Approach To Access Short Term Changes In Economic Activity Of Portugal And Spain," Revista Galega de Economía, University of Santiago de Compostela. Faculty of Economics and Business., vol. 24(2), pages 99-110.

    More about this item

    Keywords

    legitimacy; credibility; Eurozone crisis; Spain; Ireland;

    JEL classification:

    • E43 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Interest Rates: Determination, Term Structure, and Effects
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
    • E63 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
    • H12 - Public Economics - - Structure and Scope of Government - - - Crisis Management

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