Convergence of fiscal policies in EMU: a unit-root tests analysis with structural break

Christophe Blot () and Francisco Serranito

Applied Economics Letters, 2006, vol. 13, issue 4, 211-216

Abstract: The aim of this study is first to determine whether the fiscal policy among EMU countries have converged and then to identify the source of the convergence process. The convergence of fiscal policies was at the core of the fiscal criteria imposed by the Maastricht treaty but it may also have resulted from the economic and financial integration that preceded the Treaty. Some unit-root tests are implemented on the cross-country variance for various fiscal policy indicators where a break in the intercept and the trend is allowed to catch whether the convergence is due to institutional arrangements or to economic integration. We conclude that the fiscal position has converged but the break date, selected before 1992, indicates that the convergence process preceded the Maastricht treaty. Considering the fiscal receipts, the hypothesis of convergence is accepted only when they are adjusted from the cyclical component. The convergence of fiscal expenditures is finally clearly rejected.

Date: 2006
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

Downloads: (external link)
http://www.informaworld.com/openurl?genre=article& ... 40C6AD35DC6213A474B5 (text/html)
Access to full text is restricted to subscribers.

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:taf:apeclt:v:13:y:2006:i:4:p:211-216

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RAEL20

DOI: 10.1080/13504850500396009

Access Statistics for this article

Applied Economics Letters is currently edited by Anita Phillips

More articles in Applied Economics Letters from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().