Improving the SGP : taxes and delegation rather than fines

Arbeitspapier

We analyze motivations for, and possible alternatives to, the Stability and Growth Pact (SGP). With regard to the former, we identify domestic policy failures and various cross-country spillover effects; with regard to the latter, we contrast an ?economic-theory" perspective on optimal corrective measures with the ?legalistic" perspective adopted in the SGP. We discuss the advantages of replacing the Pact's rigid rules backed by fines with corrective taxes (as far as spillover effects are concerned) and procedural rules and limited delegation of fiscal powers (as far as domestic policy failures are concerned). This would not only enhance the efficiency of the Pact, but also render it easier to enforce.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 1389

Classification and Topics

• Classification: Wirtschaft ; Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy ; National Budget, Deficit, and Debt: General ; International Policy Coordination and Transmission ; International Monetary Arrangements and Institutions
• Subject: Stability and Growth Pact ; spillover effects ; policy failures ; Pigouvian taxes ; policy delegation ; EU-Stabilitätspakt ; Reform ; Finanzpolitik ; Internationale wirtschaftspolitische Koordination ; Spillover-Effekt ; Internalisierung externer Effekte ; Theorie ; EU-Staaten

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Lindbeck, Assar ; Niepelt, Dirk
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2005

Further information

• Handle: http://hdl.handle.net/10419/18753
• Last update: 10.03.2025, 11:43 AM CET