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Note on Balance of Payments and Sovereign Debt
... realism is achieved. This also implies that public savings (Sg) can be positive (surplus) or negative when a government deficit occurs. In turn, this implies a relation between government and international balance which is often dubbed as the twin deficit case, i.e. the situation in which excess gov ...
... realism is achieved. This also implies that public savings (Sg) can be positive (surplus) or negative when a government deficit occurs. In turn, this implies a relation between government and international balance which is often dubbed as the twin deficit case, i.e. the situation in which excess gov ...
the structural fiscal policy in chile: benefits and challenges
... the context of the recessive gap in 2001-03 and 2009, under depressed fiscal revenue. A structural surplus was consistent with an actual deficit in those years. In contrast to the neoliberal recipe, it implied sustaining fiscal expenditure in spite of a decreasing GDP, but it did not justified incre ...
... the context of the recessive gap in 2001-03 and 2009, under depressed fiscal revenue. A structural surplus was consistent with an actual deficit in those years. In contrast to the neoliberal recipe, it implied sustaining fiscal expenditure in spite of a decreasing GDP, but it did not justified incre ...
UK reflections on the golden rule - Office for Budget Responsibility
... • It would allow the automatic stabilisers to work, by targeting balance over the economic cycle • Coupled with debt rule, it would ensure the public finances were on a long-term sustainable path ...
... • It would allow the automatic stabilisers to work, by targeting balance over the economic cycle • Coupled with debt rule, it would ensure the public finances were on a long-term sustainable path ...
Working Paper No. 296
... and the possibility of negative spillovers from irresponsible fiscal policy must be reduced within the eurozone, hence, fiscal policy will be permanently constrained by the Stability Pact and monetary policy has been removed from national authorities and from political authorities and placed with th ...
... and the possibility of negative spillovers from irresponsible fiscal policy must be reduced within the eurozone, hence, fiscal policy will be permanently constrained by the Stability Pact and monetary policy has been removed from national authorities and from political authorities and placed with th ...
Fiscal Policy Responses to the Current Financial Crisis: Issues for
... 1) China entered the East Asian crisis with very low public debt, and so there was considerable scope to engage in deficit spending 2) China's prohibition on subnational government borrowing combined with many years of very rapid growth ensured that local governments had strong demand for infrastruc ...
... 1) China entered the East Asian crisis with very low public debt, and so there was considerable scope to engage in deficit spending 2) China's prohibition on subnational government borrowing combined with many years of very rapid growth ensured that local governments had strong demand for infrastruc ...
Slide 1
... Reference point to other countries outside the EU BCS programme Part of Eurostat’s Principal European Economic Indicators (PEEIs) for short-term analysis ...
... Reference point to other countries outside the EU BCS programme Part of Eurostat’s Principal European Economic Indicators (PEEIs) for short-term analysis ...
Transparency in Mexican Federal Revenues
... Mexico has a Fiscal Expenditure Budget. It defines tax expenditures, presents a general analysis of the main characteristics of the measurement of tax expenditures in Mexico. Also, it includes the results for each concept, classifying tax and type of treatment, as well as an analysis of the social a ...
... Mexico has a Fiscal Expenditure Budget. It defines tax expenditures, presents a general analysis of the main characteristics of the measurement of tax expenditures in Mexico. Also, it includes the results for each concept, classifying tax and type of treatment, as well as an analysis of the social a ...
Appendix on fiscal procyclicality
... to the highest levels since the restoration of democracy 20 years earlier. More remarkable: the rise in the polls, from very low to very high, came just as the economy moved from rapid growth to slow growth -- not the usual pattern. Why? ...
... to the highest levels since the restoration of democracy 20 years earlier. More remarkable: the rise in the polls, from very low to very high, came just as the economy moved from rapid growth to slow growth -- not the usual pattern. Why? ...
Chapter Six: What Europe Should Do: Getting Macroeconomics
... The budgetary rules in the EU Treaty require member states5 to avoid excessive government deficits (Art. 104.1). The rules also charge the European Commission (Art. 104.2) to monitor the development of the budgetary situation and the stock of government debt in individual member countries using two ...
... The budgetary rules in the EU Treaty require member states5 to avoid excessive government deficits (Art. 104.1). The rules also charge the European Commission (Art. 104.2) to monitor the development of the budgetary situation and the stock of government debt in individual member countries using two ...
1 An Alternative Stability and Growth Pact for the European Union
... prohibited; and member states must avoid ‘excessive’ deficits (which were defined as more than 3 per cent of GDP). The Stability and Growth Pact consists of three components: a single European Council Resolution and two Council Regulations. The Resolution commits all parties, member states, the Comm ...
... prohibited; and member states must avoid ‘excessive’ deficits (which were defined as more than 3 per cent of GDP). The Stability and Growth Pact consists of three components: a single European Council Resolution and two Council Regulations. The Resolution commits all parties, member states, the Comm ...
Fiscal Policy Rules and the European Constitution
... The normative limits of EU fiscal policy Two important points in the EU debate on institutional reform are the definition of the role to be assigned the budget and the rules relating to fiscal policy. Since Economic and Monetary Union and the introduction of the euro, they have become of extreme imp ...
... The normative limits of EU fiscal policy Two important points in the EU debate on institutional reform are the definition of the role to be assigned the budget and the rules relating to fiscal policy. Since Economic and Monetary Union and the introduction of the euro, they have become of extreme imp ...
The Shrinkage of Fiscal Space
... finance current expenditure – Deficit financing occurred despite sharply rising revenue due to economic growth and tax increases ...
... finance current expenditure – Deficit financing occurred despite sharply rising revenue due to economic growth and tax increases ...
DOC - Europa.eu
... What are the overall findings of the in-depth reviews? The economic recovery is gaining ground but challenges remain. Imbalances built up over more than a decade and it will require continued policy action to ensure that Europe returns to stronger but sustainable growth rates and steadily reduces u ...
... What are the overall findings of the in-depth reviews? The economic recovery is gaining ground but challenges remain. Imbalances built up over more than a decade and it will require continued policy action to ensure that Europe returns to stronger but sustainable growth rates and steadily reduces u ...
Evaluating the responses to the EZ crisis
... • Insistence that OMT countries enter program designed to ensure that there was no fiscal risk associated with purchases. • But ECJ argued ECB should not be in business of monitoring that fiscal program. • Academically, distinction between monetary and fiscal is moot. See this post on my blog. ...
... • Insistence that OMT countries enter program designed to ensure that there was no fiscal risk associated with purchases. • But ECJ argued ECB should not be in business of monitoring that fiscal program. • Academically, distinction between monetary and fiscal is moot. See this post on my blog. ...
Commission report - European Commission
... excessive deficit procedure (EDP). This procedure is further specified in Council Regulation (EC) No 1467/97 “on speeding up and clarifying the implementation of the excessive deficit procedure”1, which is part of the Stability and Growth Pact (SGP). Specific provisions for euro area Member States u ...
... excessive deficit procedure (EDP). This procedure is further specified in Council Regulation (EC) No 1467/97 “on speeding up and clarifying the implementation of the excessive deficit procedure”1, which is part of the Stability and Growth Pact (SGP). Specific provisions for euro area Member States u ...
The Euro at a Crossroads Wolfgang Münchau
... integrate their economic systems—or at least among countries wishing to become similar over a clearly defined time-horizon. There would have been no euro crisis, for example, if the initial membership had been confined to Germany, France, Benelux, and Finland. What constitutes similarity? I list fiv ...
... integrate their economic systems—or at least among countries wishing to become similar over a clearly defined time-horizon. There would have been no euro crisis, for example, if the initial membership had been confined to Germany, France, Benelux, and Finland. What constitutes similarity? I list fiv ...
Output growth differentials within the euro area: are they cyclical or
... and for most of the 1990s, but has fallen somewhat since the late 1990s. In order to better understand the relative importance of trends and cycles in explaining growth differences between countries, contributions by these two components to the total variance 4 can be computed. As can be seen in Cha ...
... and for most of the 1990s, but has fallen somewhat since the late 1990s. In order to better understand the relative importance of trends and cycles in explaining growth differences between countries, contributions by these two components to the total variance 4 can be computed. As can be seen in Cha ...
Governance without government or
... While lesson no.1 is fairly obvious and trivial, the lessons no. 3 to 5 are related to trade and globalisation policies to avoid negative consequences of uncooperative distributional games. Taking the Eurozone as a common and domestic market representing a fairly closed economy, these lessons appear ...
... While lesson no.1 is fairly obvious and trivial, the lessons no. 3 to 5 are related to trade and globalisation policies to avoid negative consequences of uncooperative distributional games. Taking the Eurozone as a common and domestic market representing a fairly closed economy, these lessons appear ...
Introduction Portugal has been under the excessive deficit
... Portugal has been under the excessive deficit procedure since 2 December 2009. Due to unforeseen adverse economic circumstances, the Council adopted revised recommendations to correct the excessive deficit in two occassions after 2009; first in 2012 and then in 2013. Specifically, on 21 June 2013, f ...
... Portugal has been under the excessive deficit procedure since 2 December 2009. Due to unforeseen adverse economic circumstances, the Council adopted revised recommendations to correct the excessive deficit in two occassions after 2009; first in 2012 and then in 2013. Specifically, on 21 June 2013, f ...
Alternative fiscal rules for the new eu member states
... France, not to mention Greece’s fulfillment of the constraint only thanks to acknowledged falsification of national accounts – without the application of any penalties; the same applies to the non-EMU-member UK for the last two years. Second, the 3% ceiling has been considerably softened by the Marc ...
... France, not to mention Greece’s fulfillment of the constraint only thanks to acknowledged falsification of national accounts – without the application of any penalties; the same applies to the non-EMU-member UK for the last two years. Second, the 3% ceiling has been considerably softened by the Marc ...
Fernández Arias
... negative regime change is a one-off shock • It may be more realistic for markets to infer that recent SB deterioration reveals a pattern of ratcheting up expansion, dynamically unsustainable • Extraordinary low levels of world interest rates and consequently low spreads and yields may be hiding it f ...
... negative regime change is a one-off shock • It may be more realistic for markets to infer that recent SB deterioration reveals a pattern of ratcheting up expansion, dynamically unsustainable • Extraordinary low levels of world interest rates and consequently low spreads and yields may be hiding it f ...
2008:3 Fiscal policy:assumptions and forecasts
... the aim of stabilising the economic cycle. 12 When demand and production in the economy have been low, political decisions have been made that have increased expenditure and reduced tax revenues in order to increase demand and production, a so-called Keynesian fiscal policy. Public income and expend ...
... the aim of stabilising the economic cycle. 12 When demand and production in the economy have been low, political decisions have been made that have increased expenditure and reduced tax revenues in order to increase demand and production, a so-called Keynesian fiscal policy. Public income and expend ...
Stability Bonds for the Euro Area - Peterson Institute for International
... overcome. The European safe bonds (ESBies) proposed by Brunnermeier et al. (2011) are based on financial engineering, which can’t constitute a durable policy solution. The PADRE framework proposed by Paris and Wyplosz (2014) is a debt restructuring mechanism funded by the securitization of future EC ...
... overcome. The European safe bonds (ESBies) proposed by Brunnermeier et al. (2011) are based on financial engineering, which can’t constitute a durable policy solution. The PADRE framework proposed by Paris and Wyplosz (2014) is a debt restructuring mechanism funded by the securitization of future EC ...
74019034I_en.pdf
... view, stabilization policies are a wholly ineffective way of increasing long-term growth, and actually make fluctuations more pronounced. It is thus better not to interfere with the natural adjustment towards balance; taking action and then reversing it may be more costly than simply doing nothing. ...
... view, stabilization policies are a wholly ineffective way of increasing long-term growth, and actually make fluctuations more pronounced. It is thus better not to interfere with the natural adjustment towards balance; taking action and then reversing it may be more costly than simply doing nothing. ...
Slide 1
... Reference values II • The exchange rate criterion – ECB examines whether a Member State has participated in ERM II for at least two years prior to the examination without severe tensions, in particular, without devaluing its currency against the euro. Focus is put on the exchange rate being close to ...
... Reference values II • The exchange rate criterion – ECB examines whether a Member State has participated in ERM II for at least two years prior to the examination without severe tensions, in particular, without devaluing its currency against the euro. Focus is put on the exchange rate being close to ...
Stability and Growth Pact
![](https://commons.wikimedia.org/wiki/Special:FilePath/Fiscal_Compliance_2014-debt.png?width=300)
The Stability and Growth Pact (SGP) is an agreement, among the 28 Member states of the European Union, to facilitate and maintain the stability of the Economic and Monetary Union (EMU). Based primarily on Articles 121 and 126 of the Treaty on the Functioning of the European Union, it consists of fiscal monitoring of members by the European Commission and the Council of Ministers, and the issuing of a yearly recommendation for policy actions to ensure a full compliance with the SGP also in the medium-term. If a Member State breaches the SGP's outlined maximum limit for government deficit and debt, the surveillance and request for corrective action will intensify through the declaration of an Excessive Deficit Procedure (EDP); and if these corrective actions continue to remain absent after multiple warnings, the Member State can ultimately be issued economic sanctions. The pact was outlined by a resolution and two council regulations in July 1997. The first regulation ""on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies"", known as the ""preventive arm"", entered into force 1 July 1998. The second regulation ""on speeding up and clarifying the implementation of the excessive deficit procedure"", known as the ""dissuasive arm"", entered into force 1 January 1999.The purpose of the pact was to ensure that fiscal discipline would be maintained and enforced in the EMU. All EU member states are automatically members of both the EMU and the SGP, as this is defined by paragraphs in the EU Treaty itself. The fiscal discipline is ensured by the SGP by requiring each Member State, to implement a fiscal policy aiming for the country to stay within the limits on government deficit (3% of GDP) and debt (60% of GDP); and in case of having a debt level above 60% it should each year decline with a satisfactory pace towards a level below. As outlined by the ""preventive arm"" regulation, all EU member states are each year obliged to submit a SGP compliance report for the scrutiny and evaluation of the European Commission and the Council of Ministers, that will present the country's expected fiscal development for the current and subsequent three years. These reports are called ""stability programmes"" for eurozone Member States and ""convergence programmes"" for non-eurozone Member States, but despite having different titles they are identical in regards of the content. After the reform of the SGP in 2005, these programmes have also included the Medium-Term budgetary Objectives (MTO's), being individually calculated for each Member State as the medium-term sustainable average-limit for the country's structural deficit, and the Member State is also obliged to outline the measures it intends to implement to attain its MTO. If the EU Member State does not comply with both the deficit limit and the debt limit, a so-called ""Excessive Deficit Procedure"" (EDP) is initiated along with a deadline to comply, which basically includes and outlines an ""adjustment path towards reaching the MTO"". This procedure is outlined by the ""dissuasive arm"" regulation.The SGP was initially proposed by German finance minister Theo Waigel in the mid-1990s. Germany had long maintained a low-inflation policy, which had been an important part of the German economy's strong performance since the 1950s. The German government hoped to ensure the continuation of that policy through the SGP, which would ensure the prevalence of fiscal responsibility, and limit the ability of governments to exert inflationary pressures on the European economy. As such, it was also described to be a key tool for the Member States adopting the euro, to ensure that they did not only meet the Maastricht convergence criteria at the time of adopting the euro, but kept on to comply with the fiscal criteria for the following years.