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Fiscal Discipline For Growth: The Remedy Or The Illusion In The Context Of The Euro Area Crisis

Author

Listed:
  • Sinan SÖNMEZ

    (Atilim University)

Abstract

Ever since the outbreak of the sovereign debt crisis, coordinating economic growth with fiscal sustainability has been on the European agenda. Fiscal consolidation calls for fiscal sustainability and austerity programs. But at present economic contraction/recession is the main problem, particularly in the Euro area. The problem has therefore transformed to one of combining and/or coordinating economic growth with fiscal sustainability. As fiscal discipline is a pivotal element of macroeconomic stability and fiscal sustainability, it is necessary to focus on fiscal rules and fiscal consolidation. Fiscal discipline in fact plays the main role in achieving fiscal and public debt sustainability. The approach that is currently in vogue is based on rules-based fiscal policy. It is in this context that rules-based fiscal policies continue to be implemented throughout the globe. The question to be answered, therefore, is whether economic growth and fiscal discipline can be reconciled? In other words, how does one engage the economy on a growth path in the context of fiscal austerity? In times of financial and economic crisis can fiscal rules and discipline be considered a universal prescription to overcome macroeconomic distortions and open the door to economic growth, or is this just an illusion? This paper investigates the problem of coordinating economic growth with fiscal sustainability and discipline.

Suggested Citation

  • Sinan SÖNMEZ, 2013. "Fiscal Discipline For Growth: The Remedy Or The Illusion In The Context Of The Euro Area Crisis," Ekonomik Yaklasim, Ekonomik Yaklasim Association, vol. 24(88), pages 101-115.
    • Handle: RePEc:eyd:eyjrnl:v:24:y:2013:i:88:p:101-115
    DOI: 10.5455/ey.35203
    Note: [Turkish Title] Büyüme için Mali Disiplin: Avro Bölgesi Krizine Çözüm Arayışında İlaç mı Yoksa Yanılsama mıdır? [Turkish Abstract] Avrupa’da borç krizi patlak verdikten sonra ekonomik büyüme ile kamu maliyesinin sürdürebilirliği arasında eşgüdümün sağlanması politika gündemine oturmuştur. Kamu maliyesinin konsolidasyonu mali disiplin ve katı tasarruf önlemlerini kapsamaktadır. Oysa mevcut durumda özellikle Avro bölgesindeki temel sorun ekonomik daralma ve resesyondur. Bu koşullarda ekonomik büyüme ile kamu maliyesinde sürdürebilirliğin bağdaştırılması arayışına girilmiştir. Makroekonomik istikrar ve mali sürdürebilirliğin sağlanması doğrultusunda mali disiplinin ön plana çıktığı dikkate alındığında, mali kural ve kamu maliyesinde sürdürebilirlik kavramlarına odaklanılması ihtiyacı doğmaktadır. Nitekim mali disiplin kamu maliyesinin ve kamu borcunun sürdürebilirliğinde belirleyicidir. Son dönemlerde kurallara dayalı maliye politikasının gündemde olduğu görülmektedir. Bu durumda yanıtlanması gerekli soru, ekonomik büyüme ile mali disiplinin nasıl bağdaşacağıdır. Bir diğer deyişle, kamu maliyesinde tasarruf önlemleri alınırken ekonomik büyüme nasıl canlandırılacaktır? Finansal ve ekonomik kriz ortamında mali kurallar ve mali disiplin makroekonomik göstergelerdeki bozulmayı gidererek ekonomiyi büyüme potasına sokabilir mi? Bu yaklaşım evrensel bir reçete mi, yoksa yanılsama mıdır? Bu makale Avro bölgesi borç krizi bağlamında ekonomik büyüme ile mali sürdürebilirlik ve disiplinin eşgüdümü sorunsalına odaklanmaktadır. [Turkish Keywords] Mali disiplin, tasarruf önlemleri, mali sözleşme, büyüme, avro bölgesi krizi.
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    Keywords

    Fiscal discipline; austerity; fiscal compact; growth; Euro area crisis.;
    All these keywords.

    JEL classification:

    • F61 - International Economics - - Economic Impacts of Globalization - - - Microeconomic Impacts
    • F62 - International Economics - - Economic Impacts of Globalization - - - Macroeconomic Impacts
    • H60 - Public Economics - - National Budget, Deficit, and Debt - - - General
    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus

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