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Structural Budget Balance as a Fiscal Rule in the European Union—Good, Bad, or Ugly?

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  • Ringa Raudla
  • James W. Douglas

Abstract

The EU's Fiscal Compact requires member states to legislate structural budget balance rule(s) (SBR). We use elite interviews and government documents from Austria, Ireland, and Portugal to assess the extent to which SBRs are perceived to have resulted in improved accountability, coordination, and credible commitment on the part of elected officials. We find that establishing the SBRs in legislation has not resulted in domestic ownership on the part of the member states. Furthermore, SBRs do not appear to have improved accountability due to questions about their accuracy. There is some evidence that SBRs aid finance ministries' coordination efforts.

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  • Ringa Raudla & James W. Douglas, 2021. "Structural Budget Balance as a Fiscal Rule in the European Union—Good, Bad, or Ugly?," Public Budgeting & Finance, Wiley Blackwell, vol. 41(1), pages 121-141, March.
    • Handle: RePEc:bla:pbudge:v:41:y:2021:i:1:p:121-141
    DOI: 10.1111/pbaf.12279
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    1. Ringa Raudla & James W. Douglas & Muiris MacCarthaigh, 2022. "Medium‐term expenditure frameworks: Credible instrument or mirage?," Public Budgeting & Finance, Wiley Blackwell, vol. 42(3), pages 71-92, September.
    2. Julia del Amo Valor & Marcos Martín Mateos & Diego Martínez López & Javier J. Pérez, 2023. "Is the European economic governance framework too “complex”? A critical discussion," Working Papers 2023-06, FEDEA.

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