Fiscal Integration and Growth Stimulation in Europe
Alain Durré (),
Jacques Drèze and
Jean-François Carpantier ()
Authors registered in the RePEc Author Service: Jacques H. Dreze
Recherches économiques de Louvain, 2014, vol. 80, issue 2, 5-45
With the current sovereign debt crisis, the incompleteness of economic integration in the Economic and Monetary Union (EMU) has become patent, leading to an intense debate among academics and policy makers. Much of the debate concerns fiscal rules and austerity measures, both of which weigh on growth prospects. In this paper we look at the main structural shortcomings of EMU through the lens of general equilibrium theory. We address two issues (international sharing of macroeconomic risks and coordinated growth stimulation) which are at the heart of the sustainability of EMU. We propose : (A) a specific scheme for mutual insurance of macroeconomic risks ; (B) locating responsibility for demand policies at the EMU level, with ambitious investment programs (public, or fiscally-neutral private) as main instrument. JEL Classification : E24, E63, H63.
Keywords: general equilibrium model; risk sharing; growth stimulation; fiscal integration; indexed bonds (search for similar items in EconPapers)
JEL-codes: E24 E63 H63 (search for similar items in EconPapers)
References: Add references at CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
Working Paper: Fiscal Integration and Growth Stimulation in Europe (2014)
Working Paper: Fiscal integration and growth stimulation in Europe (2013)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:cai:reldbu:rel_802_0005
Access Statistics for this article
More articles in Recherches économiques de Louvain from De Boeck Université
Bibliographic data for series maintained by Jean-Baptiste de Vathaire ().