Muscatelli, V.A., Natale, P. and Tirelli, P. (2012) A simple and flexible alternative to Stability and Growth Pact deficit ceilings. Is it at hand? European Journal of Political Economy, 28(1), pp. 14-26. (doi: 10.1016/j.ejpoleco.2011.07.004)
Full text not currently available from Enlighten.
Abstract
We model a monetary union where fiscal discretion generates excessive debt accumulation in steady state and inefficiently delayed debt adjustment following shocks. By setting a debt target and raising the political cost of deviating from the optimal pace of debt reversal¸ institutional design induces fiscal policymakers to implement unbiased responses to shocks. This is partly achieved by increasing the transparency of the decision-making process. We therefore call for more focused supervision tasks for the European Commission and for parliamentary discussion whenever a disagreement arises between the Commission and a national government.
| Item Type: | Articles |
|---|---|
| Status: | Published |
| Refereed: | Yes |
| Glasgow Author(s) Enlighten ID: | Muscatelli, Professor Anton |
| Authors: | Muscatelli, V.A., Natale, P., and Tirelli, P. |
| Subjects: | H Social Sciences > HB Economic Theory H Social Sciences > HJ Public Finance |
| College/School: | College of Social Sciences > Adam Smith Business School > Economics University Services > Strategy and Planning > Principal’s Office |
| Journal Name: | European Journal of Political Economy |
| Publisher: | Elsevier B.V. |
| ISSN: | 0176-2680 |
| ISSN (Online): | 1873-5703 |
| Published Online: | 28 July 2011 |
University Staff: Request a correction | Enlighten Editors: Update this record
Altmetric
Altmetric