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Numerical Compliance with EU Fiscal Rules: Facts and Figures from a New Database

Author

Listed:
  • Larch Martin

    (Secretariat of the European Fiscal Board, Brussels, Belgium.)

  • Malzubris Janis

    (Secretariat of the European Fiscal Board, Brussels, Belgium.)

  • Santacroce Stefano

    (Secretariat of the European Fiscal Board, Brussels, Belgium.)

Abstract

EU fiscal rules are meant to keep public finances on a sustainable path. This paper presents a new database that tracks numerical compliance with the four main rules of the Stability and Growth Pact starting in 1998. Our assessment of numerical compliance abstracts from the many exceptions and elements of discretion allowed by the letter and the spirit of EU law. It focuses on the main course of action implied by the rules. Overall, our database points to a very mixed compliance record. On average – across countries, years and rules – budgetary policies of the EU member states are compliant in just over half of the cases with stark and persistent differences across countries. We also detect a distinct cyclical pattern of compliance, which sends false signals of safety in good times.

Suggested Citation

  • Larch Martin & Malzubris Janis & Santacroce Stefano, 2023. "Numerical Compliance with EU Fiscal Rules: Facts and Figures from a New Database," Intereconomics: Review of European Economic Policy, Sciendo, vol. 58(1), pages 32-42, January.
    • Handle: RePEc:vrs:intere:v:58:y:2023:i:1:p:32-42:n:3
    DOI: 10.2478/ie-2023-0008
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    References listed on IDEAS

    as
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    2. Beetsma, Roel & Debrun, Xavier & Fang, Xiangming & Kim, Young & Lledó, Victor & Mbaye, Samba & Zhang, Xiaoxiao, 2019. "Independent fiscal councils: Recent trends and performance," European Journal of Political Economy, Elsevier, vol. 57(C), pages 53-69.
    3. Martin Larch & Alessandro Turrini, 2010. "The cyclically adjusted budget balance in EU fiscal policymaking," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 45(1), pages 48-60, January.
    4. Francesca Caselli & Mr. Philippe Wingender, 2018. "Bunching at 3 Percent: The Maastricht Fiscal Criterion and Government Deficits," IMF Working Papers 2018/182, International Monetary Fund.
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    More about this item

    JEL classification:

    • C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - General
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General
    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus

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