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The Stability and Growth Pact - Not the best but better than nothing. Reviewing the debate on fiscal policy in Europe's Monetary Union

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  • Heipertz, Martin

Abstract

This paper aims to review the economic literature on the Maastricht deficit rule and the Stability and Growth Pact. The author tries to expose the contradictions and inconclusiveness of the debate, highlighting both the criticism and the defense of the fiscal policy regime in EMU. The paper is non-technical and seeks to provide an overview for a readership outside the economics profession. The concluding judgment is that the pact can be criticized on a number of grounds, but that the lack of a politically feasible alternative makes it a second best solution that should not be undermined in the present crisis.

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  • Heipertz, Martin, 2003. "The Stability and Growth Pact - Not the best but better than nothing. Reviewing the debate on fiscal policy in Europe's Monetary Union," MPIfG Working Paper 03/10, Max Planck Institute for the Study of Societies.
    • Handle: RePEc:zbw:mpifgw:0310
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    Cited by:

    1. Arne Heise, 2014. "Zwangsjacke Euro. Die Fehlkonstruktion des Europäischen Economic Governance-Systems," Wirtschaft und Gesellschaft - WuG, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik, vol. 40(1), pages 17-31.
    2. Hoekstra, Ruth & Horstmann, Cécile & Knabl, Juliane & Kruse, Derek & Wiedemann, Sarah, 2007. "Germanizing Europe? The evolution of the European Stability and Growth Pact," Working Papers on Economic Governance 24, University of Hamburg, Department of Socioeconomics.
    3. Heipertz, Martin & Verdun, Amy, 2003. "The dog that would never bite? The past and future of the Stability and Growth Pact," MPIfG Working Paper 03/12, Max Planck Institute for the Study of Societies.

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