The Debt Brake in the Eyes of the German Population

27 Pages Posted: 12 Dec 2014 Last revised: 14 Dec 2014

See all articles by Bernd Hayo

Bernd Hayo

University of Marburg - School of Business & Economics

Florian Neumeier

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute

Date Written: June 23, 2014

Abstract

In response to the recent sovereign debt crisis, the member states of the European Union agreed to enact balanced budget rules in their national legislation. However, little is known about the public’s opinion of balanced budget rules. To fill this gap, we conducted a survey among 2,000 representatively chosen German citizens. Our findings suggest that 61% of the German population supports the debt brake, whereas only 8% oppose it. However, approval rates differ notably among various subgroups of the population. The debt brake enjoys greater support among high-income earners and among those well-informed about the future costs of deficit spending. People who do not trust politicians would like to see the government’s hands tied even more tightly. Opinions about the debt brake also differ markedly across the supporters of different political parties.

Keywords: Debt brake, balanced budget rule, European Fiscal Compact, survey, Germany

JEL Classification: E02, E62, H62, H63

Suggested Citation

Hayo, Bernd and Neumeier, Florian, The Debt Brake in the Eyes of the German Population (June 23, 2014). Available at SSRN: https://ssrn.com/abstract=2536906 or http://dx.doi.org/10.2139/ssrn.2536906

Bernd Hayo

University of Marburg - School of Business & Economics ( email )

Universitaetsstr. 24
Marburg, D-35032
Germany
++49(0)6421-28-23091 (Phone)
++49(0)6421-28-23193 (Fax)

Florian Neumeier (Contact Author)

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute ( email )

Poschinger Str. 5
Munich, 01069
Germany

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