The behaviour of fiscal authorities and its interplay with budgetary institutions is a
recent and increasingly important area of economic research, heightened by the move to
single currency in Europe. This volume provides a systematic analysis of issues including
the determinants of fiscal retrenchment strategies, the role of numerical and procedural
rules, the composition of the adjustment, the (dis)similarity of fiscal behaviour across
countries, the interactions between fiscal and monetary authorities, and the long run
factors shaping fiscal behaviour and sustainability. Authors include leading academic
economists, who have contributed to shape the research in these matters, and policy makers
(from the ECB, European Commission, IMF, OECD) who provide an institutionally-relevant
angle to the analysis.
Table of Contents:
Overview by the editors
PART 1: HOW DO FISCAL AUTHORITIES BEHAVE?
Strategies of Budgetary Consolidation in the 1990s; J.von Hagen, A.Hughes Hallet &
R.Strauch
Entry and Exit Dynamics from Excessive Deficits; A.Bayar & P. de Boer
Convergence of Fiscal Policies in the Euro Area; O.De Bandt & F.Mongelli
Fiscal policy and the size of governments; C. Martinez-Mongay
Budgetary Institutions for Sustainable Public Finances; J.von Hagen, A.Hughes Hallet &
R.Strauch
PART 2: FISCAL POLICY FOR STABILISATION AND GROWTH
How to allow the automatic stabilisers to operate fully? A policy maker's guide for EMU
countries; Ph.Mills & A.Quinet
Automatic Stabilisers in the 1990s and Beyond; P.van den Noord
Fiscal Policy in the European Monetary Union: the Stabilisation Aspects; W.Roeger &
H.Wijkander
Gauging Ricardian Effects; A.Brunila
Impact of Large Public Debt on Growth: a Discussion of Potential Channels; V.Tanzi &
N.Chalk
PART 3: MONETARY AND FISCAL POLICY INTERACTIONS IN EMU
Debt, Deficits and the Behaviour of Monetary and Fiscal Authorities; J.Mélitz
Interactions between Monetary and Fiscal Policy under a Stability Pact; M. Buti, J.In't
Veld & W.Roeger
Central Bank Independence, Political Uncertainty and the Assignment of Instruments to
Targets; A.Hughes Hallett & N.Viegi
Author Biographies:
MARCO BUTI is currently responsible for public finances in EMU in the Directorate-General
for Economic and Financial Affairs, and part time Professor at the European University
Institute. He is editor and co-author of a number of books in this area.
JÜRGEN VON HAGEN is
Professor of Economics and Director at the Center for European Integration Studies at the
University of Bonn. Previously he taught at Indiana University and the University of
Manheim. He has published over 150 articles in academic journals. He has been a consultant
to the European Commission, the World Bank and the IMF.
CARLOS MARTINEZ MONGAY is
currently head of sector in the Directorate-General for Economic and Financial Affairs,
and Lecturer at the University of Zaragoza. He has published papers in academic journals
and has contributed chapters to several monographs.
304 pages
