After the financial and economic crisis in Europe, a broad consensus has emerged that a stronger fiscal dimension may be needed to complete the architecture of Economic and Monetary Union (EMU). This paper analyses the performance of interregional transfers in existing fiscal-federal systems,...

Fiscal federalism may not be a panacea in a monetary union if it does not address the non-cooperative behaviour between fiscal policymakers. To prove this, we assess the relative merits of a fiscal federalism scheme in a monetary union and intergovernmental fiscal cooperation without such a...

The combination of subsidiarity with the principles of fiscal federalism ensures that the government has the knowledge to provide the economically efficient number and amount of public goods without either leaving too much or too little productive activity to the sphere of private exchange. In...