Search results for "Stability and Growth Pact"
showing 3 items of 3 documents
Is an Increase of the Fiscal Budget at EMU level Desirable?
2005
The birth of the European Monetary Union (EMU) has determined the creation of a common currency, the Euro, but unlike other monetary unions, the EMU does not have a central fiscal authority. The role of fiscal policy is left to the responsibility of the governments of the EMU member States. The new architecture modifies the assignment of the instruments to the objectives, especially those of stabilization. The loss of the sovereignty of monetary policy and exchange rate control by the individual member states has determined the inability to use two important instruments of insurance against the risks of shocks. Moreover, the Treaty of Maastricht and the Stability and Growth Pact (SGP) could…
The Economic Rationale of Fiscal Rules in OCAs: The Stability and Growth Pact and the Excessive Deficit Procedure
2013
This chapter examines the case of different regions within a single country that wish to share a common currency, even though they have divergent trends in unemployment, inflation, wages, non-wage costs and productivity. This situation compares with the case of a group of EU countries, each with its own decentralised national budget, that have established a monetary union and that are facing asymmetric shocks. As such an economic context requires fiscal commitments from national governments, we analyse the economic rationale of setting fiscal rules for a common currency area and the resulting EU institutional frame for the Stability and Growth Pact (SGP) and the Excessive Deficit Procedure …
Germany Needs a National Stability Pact
2003
In many publications1, Horst Siebert has recommended that national fiscal policies within European Monetary Union be subjected to certain conditions in order to lay the foundation for a stable currency. Provisions to this effect have been laid down in Art. 104 of the EC Treaty and the European Stability and Growth Pact. The first “acid test”, however, has cast doubt on whether these provisions are sufficient to ensure sustainable solid public-sector finance in the member countries.