This paper examines the question whether joining EMU or the breach of the Stability and Growth Pact in 2003 had an impact on the deficit policy of member states. The empirical analysis gives no hint for an alteration of deficit policy after having joined EMU or after having breached the Pact in...

Most parts of the Euro area have seen seven years of deep economic crisis. The strategy of tightening the fiscal constraints of the SGP has driven many member states into austerity. In contrast, the golden rule of public investment proposed in this study would be one important element of the...

We show that some types of fiscal rules can mitigate the well-known procyclical bias in public capital expenditures. Past research has found that fiscal adjustment episodes coincide with large public investment cuts, a pattern we also document in a sample of 75 advanced and emerging economies...

This paper investigates how numerical fiscal rules affect government investment in the EU and disentangles their effect over the business cycle. Public investment seems to be generally susceptible to cutbacks during recessions. Fiscal rules demonstrate heterogeneous effects, depending on their...

Following the invitation contained in the October 2009 Council Conclusions, 21 EU Member States included in their respective 2009-2010 Stability and Convergence Programmes (SCPs) information related to the reform of domestic fiscal frameworks. However, detailed information on the scope of these...