| dc.creator |
Hedbavny, Petr |
|
| dc.creator |
Schneider, Ondřej |
|
| dc.creator |
Zapal, Jan |
|
| dc.date |
2005 |
|
| dc.date.accessioned |
2013-10-16T07:02:11Z |
|
| dc.date.available |
2013-10-16T07:02:11Z |
|
| dc.date.issued |
2013-10-16 |
|
| dc.identifier |
http://hdl.handle.net/10419/18963 |
|
| dc.identifier |
ppn:500516766 |
|
| dc.identifier.uri |
http://koha.mediu.edu.my:8181/xmlui/handle/10419/18963 |
|
| dc.description |
In this paper, we set out to examine an efficient fiscal-policy framework for a monetary union. We illustrate that fiscal policy?s bias toward budget deficit only temporarily ceased at the end of the 20th century as European countries endeavored to qualify for euro-zone membership, which compelled strict limits on budgetary deficits. We then explore which mechanisms might instill a sense of fiscal disciple in governments. We find that most mechanisms suffer from the incentive-incompatible setup whereby governments restrict their own fiscal-policy freedom. We argue that even multilateral fiscal rules, such as the EU?s Stability and Growth Pact, suffer from the same endogeneity flaw. Consequently, we argue that a fiscal rule must incorporate an external authority that would impartially assess fiscal-policy developments. Using U.S. debt and bond-market data at the state level, we show that financial markets represent a good candidate as, vis-?-vis the American states, they do differentiate state debt according to the level of debt. We thus argue for a fiscal institution??what we call the Fiscal Sustainability Council??that would actively bring financial markets into the fiscal-policy process, and we explain the technique whereby this could be effected. |
|
| dc.language |
eng |
|
| dc.relation |
CESifo working papers 1499 |
|
| dc.rights |
http://www.econstor.eu/dspace/Nutzungsbedingungen |
|
| dc.subject |
H6 |
|
| dc.subject |
H87 |
|
| dc.subject |
E6 |
|
| dc.subject |
ddc:330 |
|
| dc.subject |
fiscal policy |
|
| dc.subject |
European Union |
|
| dc.subject |
sustainability |
|
| dc.subject |
Finanzpolitik |
|
| dc.subject |
EU-Stabilitätspakt |
|
| dc.subject |
Europäische Wirtschafts- und Währungsunion |
|
| dc.subject |
Anreizvertrag |
|
| dc.subject |
Finanzmarkt |
|
| dc.subject |
Länderrisiko |
|
| dc.subject |
EU-Staaten |
|
| dc.title |
A fiscal rule that has teeth : a suggestion for a "fiscal sustainability council" underpinned by the financial markets |
|
| dc.type |
doc-type:workingPaper |
|