Fiscal Behaviour in the European Union: Rules, Fiscal Decentralization and Government Indebtedness

47 Pages Posted: 7 May 2009

See all articles by António Afonso

António Afonso

University of Lisbon - ISEG (School of Economics and Management); UECE (Research Unit on Complexity and Economics); ISEG Lisbon School of Economics and Management,Universidade de Lisboa

Sebastian Hauptmeier

European Central Bank (ECB) - Directorate General Economics

Date Written: May 7, 2009

Abstract

We assess the fiscal behaviour in the European Union countries for the period 1990-2005 via the responsiveness of budget balances to several determinants. The results show that the existence of effective fiscal rules, the degree of public spending decentralization, and the electoral cycle can impinge on the country’s fiscal position. Furthermore, the results also support the responsiveness of primary balances to government indebtedness.

Keywords: fiscal regimes, fiscal rules, fiscal decentralization, European Union, panel Data

JEL Classification: C23, E62, H62

Suggested Citation

Afonso, António and Hauptmeier, Sebastian, Fiscal Behaviour in the European Union: Rules, Fiscal Decentralization and Government Indebtedness (May 7, 2009). ECB Working Paper No. 1054, Available at SSRN: https://ssrn.com/abstract=1399284

António Afonso (Contact Author)

University of Lisbon - ISEG (School of Economics and Management) ( email )

R. Miguel Lupi, 20
Lisbon, 1248-078
Portugal
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+351 21 396 6407 (Fax)

HOME PAGE: http://https://www.iseg.ulisboa.pt/aquila/homepage/aafonso

UECE (Research Unit on Complexity and Economics)

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Lisbon, 1249-078
Portugal
+351-213 925 912 (Phone)
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HOME PAGE: http://https://uece.rc.iseg.ulisboa.pt/

ISEG Lisbon School of Economics and Management,Universidade de Lisboa ( email )

Rua do Quelhas 6
LISBOA, 1200-781
Portugal

Sebastian Hauptmeier

European Central Bank (ECB) - Directorate General Economics ( email )

Kaiserstrasse 29
D-60311 Frankfurt am Main
Germany

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