The failure of key EU Member States to respect the requirements of the Stability and Growth Pact (SGP) a few years after its inception triggered a heated debate on how to reform the framework of fiscal policy coordination in the Economic and Monetary Union (EMU). This paper systematically...

Most of the reforms discussed within the framework of the Lisbon strategy will benefit public finances in the long term. However, in the short-term, there could a trade-off between some structural reforms and budgetary discipline. This possible tension between reforms and fiscal discipline was...

We use a policy rule framework and focus on the response of the primary surplus to accumulated public debt to test a sufficient condition for sustainability. The evidence we report suggests that sustainability was prevalent in many EU countries before Maastricht, but also that the Maastricht...

There is a broad consensus among economists that the increased interdependence that comes from sharing a common currency and a single monetary policy justifies some degree of economic policy coordination between euro area Member States. However, empirical studies have, thus far, offered...

The Stability and Growth Pact (SGP) adopted in 1997 originally set budget balance as the medium-term objective (MTO) for all EU Member States, to create a safety margin under the 3% of GDP deficit ceiling. In a reform in 2005, MTOs were made country-specific and dependent on initial debt and the...

The aim of this paper is to assess the reliability of the government deficit and debt figures reported to the European Commission by Member States. Reliability is one of the several dimensions of quality in statistics; it refers to the magnitudes of data revisions after the publication of the...

While the Maastricht Treaty establishes the entry conditions for Member States to join the single currency, the Stability and Growth Pact (SGP) aims to make budgetary discipline a permanent feature of EMU. Consequently, the Pact is commonly interpreted as a major building block of EMU's...