European fiscal rules after the crisis
Европейские бюджетно-фискальные правила после кризиса
2010-11-02
SCID: 54.1/2ayk8jcc
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EU fiscal frameworkEuropean fiscal rulesStability and Growth Pactcounterfactual experimentgolden rule of public finance
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Abstract (AI)
The main purpose of this note is to question the relevance of trying to strengthen a fiscal framework which has been ineffective over the years; doing so, we compare the SGP with a possible alternative, a golden rule of public finance. We take the classification proposed by Kopits and Symansky (1998) as a benchmark. Our assessment shows that a golden rule would be superior to the actual EU fiscal framework. A counterfactual experiment does not contradict this outcome.JEL codes: E61, H30, H60, H70
Key Findings
1
A counterfactual experiment supports rather than contradicts the conclusion that the golden rule would outperform the existing framework.
2
The assessment finds that a golden rule of public finance would be superior to the current EU fiscal framework.
3
The paper questions strengthening the Stability and Growth Pact (SGP), arguing that the existing fiscal framework has been ineffective over time.
4
Using the Kopits and Symansky (1998) classification as a benchmark, the paper compares the SGP with a golden rule of public finance.
Research Object
European Union fiscal framework, including the Stability and Growth Pact (SGP) and a possible golden rule of public finance
Research Subject
Comparative effectiveness and superiority of alternative fiscal rules after the crisis
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2010-11-02
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