 Adapting the EU Fiscal Governance to New Macroeconomics and Political RealitiesRaffaele Fargnoli No 2020/03, RSCAS Working Papers from European University Institute Abstract: Reforming the Stability and Growth Pact is regarded by almost all accounts as a top priority, although finding a political agreement on a new model seems at this stage highly problematic. The widespread consensus on the need to modify current fiscal rules has triggered a wave of new studies and reform proposals. The aim of this paper is to reflect on whether it is possible to find an optimal design of fiscal rules to promote sound and effective fiscal policy conduct in the EMU in most circumstances. This question is discussed under three different dimensions: i) the political economy of fiscal rules in the current political and economic environment; ii) the renewed theoretical debate about fiscal policy roles and objectives; iii) the currently incomplete nature of the Economic and Monetary Union and the prospects for its completion. Drawing a number of conclusions from this conceptual framework, the paper suggests a pathway for an overhaul of the EU fiscal governance, based on a more cooperative approach between the EU and national governments, presenting general principles and more specific features. Keywords: EU Fiscal rules; EU Fiscal policy; EU economic governance; EMU deepening (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:rsc:rsceui:2020/03 Access Statistics for this paper More papers in RSCAS Working Papers from European University Institute Convento, Via delle Fontanelle, 19, 50014 San Domenico di Fiesole (FI) Italy. Contact information at EDIRC. |
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