Fiscal Costs of Delaying the EMU Accession - Medium Term Fiscal Projection for Selected New EU Members

Michal Gorzelak

No 277, CASE Network Studies and Analyses from CASE-Center for Social and Economic Research

Abstract: The paper presents series of medium term economic simulations, evaluating fiscal costs of different EMU entry scenarios for six of the new EU members. Projections cover period of 2004- 2012 and use basic macroeconomic equations in an attempt to assess the value of public debtrelated costs that may occur in each of the countries, under specific assumptions. Four series of simulations were run, assuming two different EMU entry dates (2007 and 2012), and two growth scenarios (2% and 5% of real GDP growth p.a.). For each growth variant the early and late accession projections are compared in order to evaluate the net fiscal effect of delaying the EMU entry. Those effects depend on country’s starting position and are quite significant for most of the countries in question. Poland and Hungary are the biggest winners of the earlier EMU entry simulations, both saving equivalence of 18-20% of their 2004 GDP levels (as compared to results of the late accession scenarios). It appears that the GDP growth rate does not seriously affect the volume of the gains, which are rather generated by the faster interest rate reduction and tighter fiscal policies in case of the earlier EMU accession.

Keywords: fiscal projection; public debt; EMU accession; CEE countries (search for similar items in EconPapers)
Pages: 27 Pages
Date: 2004
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://case-research.eu/upload/publikacja_plik/29 ... 4%2006%2028%20ok.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found

Related works:
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:sec:cnstan:0277

Access Statistics for this paper

More papers in CASE Network Studies and Analyses from CASE-Center for Social and Economic Research Contact information at EDIRC.
Bibliographic data for series maintained by Marta Kowerko ().