Public finance sustainability in Europe: a behavioral model

Gilles Dufrénot () and Carolina Ulloa Suarez ()
Additional contact information
Carolina Ulloa Suarez: Aix-Marseille Univ, CNRS, EHESS, Ecole Centrale, AMSE, Marseille, France., https://www.amse-aixmarseille.fr/en/membres/ulloa-suarez

No 1929, AMSE Working Papers from Aix-Marseille School of Economics, France

Abstract: This paper investigates the sustainability of public finances in the European countries since 2002. We provide evidence of heterogenous behaviors among the EU countries and show that, even if they had been forced to focus their fiscal efforts on correcting the deviations of debt from their ceiling -through a correcting mechanism such as the recent TSCG rule-, this would not necessarily have changed the likelihood that debt and deficits become more sustainable. Sources of deviations from stable debt and deficits are related to the macroeconomic environment: the interest-growth differential, momentum dynamics in the sovereign bond markets, how markets react to rising debt.

Keywords: fiscal rules; euro area; quantile regression; stability (search for similar items in EconPapers)
JEL-codes: C14 C51 C61 (search for similar items in EconPapers)
Pages: 52 pages
Date: 2019-11
New Economics Papers: this item is included in nep-eec
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.amse-aixmarseille.fr/sites/default/fil ... /wp_2019_-_nr_29.pdf (application/pdf)

Related works:
Working Paper: Public finance sustainability in Europe: a behavioral model (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aim:wpaimx:1929

Access Statistics for this paper

More papers in AMSE Working Papers from Aix-Marseille School of Economics, France AMU-AMSE - 5-9 Boulevard Maurice Bourdet, CS 50498 - 13205 Marseille Cedex 1. Contact information at EDIRC.
Bibliographic data for series maintained by Gregory Cornu ().