Fiscal Policy and Growth in the Context of European Integration

National Bank of Belgium Working Paper No. 7

41 Pages Posted: 9 Nov 2010

Date Written: May 1, 2000

Abstract

The paper considers the issue of whether a supranational fiscal policy in Europe is needed, and, if so what responsibilities it should undertake. The literature on endogenous growth and the principle of subsidiarity suggest that such a policy should be limited to externalities or economies of scale not captured at the national level. These may include spending on research and development and transportation or knowledge networks, and harmonization of social security designed to enhance labor mobility. EU-wide stabilization policy or enhanced EU redistribution does not seem justified, however.

Suggested Citation

Masson, Paul R., Fiscal Policy and Growth in the Context of European Integration (May 1, 2000). National Bank of Belgium Working Paper No. 7, Available at SSRN: https://ssrn.com/abstract=1705106 or http://dx.doi.org/10.2139/ssrn.1705106

Paul R. Masson (Contact Author)

C.D. Howe Institute

67 Yonge St., Suite 300
Toronto, Ontario M5E 1J8
Canada

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