The Stability and Growth Pact: crisis and reform

Ludger Schuknecht (), Philippe Moutot (), Philipp Rother () and Jürgen Stark ()
Additional contact information
Philippe Moutot: European Central Bank, Kaiserstrasse 29, 60311 Frankfurt am Main, http://www.ecb.europa.eu/home/html/index.en.html
Philipp Rother: European Central Bank, Kaiserstrasse 29, 60311 Frankfurt am Main, http://www.ecb.europa.eu/home/html/index.en.html
Jürgen Stark: European Central Bank, Kaiserstrasse 29, 60311 Frankfurt am Main, http://www.ecb.europa.eu/home/html/index.en.html

No 129, Occasional Paper Series from European Central Bank

Abstract: The sovereign debt crisis in the euro area is a symptom of policy failures and deficiencies in – among other things – fiscal policy coordination. The first nine years of the euro were not used effectively in order to improve public finances, while the Stability and Growth Pact was watered down. Spillovers from the financial and economic crisis compounded fiscal difficulties in the euro area, especially in certain member countries. This paper looks back at the history of fiscal policies and rules in Economic and Monetary Union (EMU). It makes proposals to strengthen fiscal policy governance that go well beyond the legislation set to be adopted in autumn 2011. The authors consider these additional governance measures to be essential for effective policy coordination and sound public finances in the future. JEL Classification: H6, E6

Keywords: fiscal rules; Stability and Growth Pact; fiscal deficits; public debt; EU institutional reform (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba, nep-eec and nep-mac
Date: 2011-09
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Journal Article: The Stability and Growth Pact: Crisis and Reform (2011)
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Persistent link: http://EconPapers.repec.org/RePEc:ecb:ecbops:20110129

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