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The Implementation of Economic Rules: From the Stability and Growth Pact to the European Semester

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  • Camilla Mariotto

Abstract

Country‐specific recommendations (CSRs) were introduced by the Stability and Growth Pact and offered guidance to countries in fiscal policies. Coordination was very limited and unsystematic in terms of policies and obligations. In the aftermath of the euro area financial crisis, the European Union reinforces the pre‐existing policy cycle with the European Semester. Why do countries implement CSRs? Are there explanatory differences in their implementation before and after the introduction of the European Semester? We argue that the study of the entire history of the CSRs provides a unique chance to unravel opposite causal mechanisms. Employing an original dataset, we show that, in the first period, electoral proximity reduces implementation. We find also that, if a country is in (out of) the euro area, it is more (less) inclined to adhere to the CSRs as inflation increases. In the European Semester, instead, inflationary pressure and higher costs of enforcement increase implementation.

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  • Camilla Mariotto, 2022. "The Implementation of Economic Rules: From the Stability and Growth Pact to the European Semester," Journal of Common Market Studies, Wiley Blackwell, vol. 60(1), pages 40-57, January.
    • Handle: RePEc:bla:jcmkts:v:60:y:2022:i:1:p:40-57
    DOI: 10.1111/jcms.13265
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    References listed on IDEAS

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    Cited by:

    1. Guter-Sandu, Andrei & Haas, Armin & Murau, Steffen, 2023. "Green Macro-Financial Governance in the European Monetary Architecture: Assessing the Capacity to Finance the Net-Zero Transition," SocArXiv 4mb2q, Center for Open Science.
    2. Valerie D'Erman & Amy Verdun, 2022. "An Introduction: “Macroeconomic Policy Coordination and Domestic Politics: Policy Coordination in the EU from the European Semester to the Covid‐19 Crisis”," Journal of Common Market Studies, Wiley Blackwell, vol. 60(1), pages 3-20, January.
    3. Robert Csehi & Daniel F. Schulz, 2022. "The EU's New Economic Governance Framework and Budgetary Decision‐Making in the Member States: Boon or Bane for Throughput Legitimacy?," Journal of Common Market Studies, Wiley Blackwell, vol. 60(1), pages 118-135, January.
    4. Marjoleine Hennis, 2022. "Par le Haut Ou Par les Pays‐Bas? French and Dutch Approaches to European Social Policy Coordination Compared," Journal of Common Market Studies, Wiley Blackwell, vol. 60(1), pages 136-151, January.

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