In spite of the widespread use of the concept of potential output in economic theory and empirical applications as well as in economic policy debates, the historical background and the assumptions inherent to this concept are rarely made transparent, let alone critically questioned. Against this...

Most of the newly acceded central and east European EU countries are among the main beneficiaries of EU Cohesion Policy. The main objective of this policy is to improve the long-term growth and employment prospects of the supported regions, and thereby to support convergence towards higher...

We study the impact of expenditure rules on the propensity for governments to deviate from their expenditure plans in response to surprising cyclical developments. Theoretical considerations suggest that due to political fragmentation in the budgetary process expenditure policy might be prone to...