In recent theoretical and empirical research the variation in political and institutional arrangements which may affect the process of national policy formation is examined, in order to explain cross-country differences with respect to fiscal policies pursued. In this paper we build upon this...

This paper presents new evidence on the hypothesis that coalition governments will find it more difficult to keep their budgets in line after an adverse economic shock than do one-party, majoritarian governments. The estimates are based on a broad sample of OECD countries, for the period...

Chapter 1 of the report discusses the immediate macroeconomic outlook for the global economy, with a particular focus on the European situation. Chapter 2 focuses on Switzerland, and specifically on the lessons that Europe can learn from the Swiss experience in maintaining cohesion while...

This chapter identifies the factors that led to imbalances in the euro area, which resulted in the current balance-of-payments crisis. The chapter also discusses how rebalancing might be achieved, and how fiscal policy could accelerate this process.

This chapter investigates two of the most widely debated aspects of US fiscal and financial integration: (1) the responsibility of the federation for state-level debts and for the creditworthiness of states; and (2) the working of a federal central bank. Today’s fiscal federalism in the United...