Why has the Stability and Growth Pact Failed?
Year: 2004
Type: article
Abstract: This paper evaluates the Stability and Growth Pact. After briefly examining the rules in place and the experience so far, the Pact is analysed from a political economy perspective, focusing on the choice of hard versus soft law and drawing inferences from characteristics of successful fiscal rules at the state level in the USA. The main argument of the paper is that the Pact's enforcement mechanisms are too weak. It is also argued that big countries are less likely to adhere to the fiscal policy rules in place. Reform of the Pact should aim at stricter, instead of more flexible, rules and should not rely on cyclically adjusted deficit estimates.
Source: International Finance
Authors: Jakob De Haan, Helge Berger, David‐Jan Jansen
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2093517569