FISCAL RISK SHARING IN THE ECONOMIC AND MONETARY UNION

Nelly Popova

No 10913061, Proceedings of Economics and Finance Conferences from International Institute of Social and Economic Sciences

Abstract: The economic, debt and banking crises had strongly asymmetric effects on euro area countries and revealed the vulnerabilities in the institutional setting of the EMU and created significant risks to the single currency. In the aftermath of the crises there were significant changes in EMU aimed at increased risk sharing but they did involve the introduction of supra-national macroeconomic stabilization function. It is suggested in the paper that deeper fiscal integration is necessary to complement the currency union and strengthen the economic integration in the EU. The paper outlines the theoretical background of risk sharing and examines the main alternatives for a common fiscal capacity in the euro area.

Keywords: Fiscal Policy; Economic Integration; Fiscal Federalism (search for similar items in EconPapers)
JEL-codes: E62 F15 H77 (search for similar items in EconPapers)
Pages: 11 pages
Date: 2020-07
New Economics Papers: this item is included in nep-mac and nep-mon
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Published in Proceedings of the Proceedings of the 13th Economics & Finance Conference, Prague, Jul 2020, pages 147-157

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Persistent link: https://EconPapers.repec.org/RePEc:sek:iefpro:10913061

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