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Multi-level governance in fiscal consolidation and stabilisation

Schelkle, Waltraud, and Mabbett, Deborah. (2007) Multi-level governance in fiscal consolidation and stabilisation. In: UNSPECIFIED, Montreal, Canada. (Unpublished)

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    Economists discuss multi-level governance in terms of fiscal federalism, namely as a problem of assigning fiscal functions optimally to different tiers of government. This literature assumes that the jurisdiction of the monetary authority coincides with that of the central fiscal authority. However, EMU implied for each member state that national fiscal policy became devolved relative to supranational monetary policy. In several member states, this ‘upward’ devolution of stabilisation came on top of fiscal decentralisation in the conventional sense. In the run-up to EMU, and even earlier, governments tended to decentralise public finances. The question this paper asks is how this dual trend of devolution relates to the goals of the EMU fiscal framework and its operation in practice. In this paper, we argue that laboratory fiscal federalism is a more appropriate framework than functional public finance or constitutional public choice for understanding fiscal devolution in EMU. We explore to what extent national governments have used innovations in upward and downward devolution to get better control over their budgets, using EMU as a lever. We also ask what this potential gain in budgetary control and consolidation has meant for national stabilisation in EMU.

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    Item Type: Conference or Workshop Item (UNSPECIFIED)
    Uncontrolled Keywords: Fiscal federalism; fiscal stabilisation.
    Subjects for non-EU documents: EU policies and themes > Policies & related activities > economic and financial affairs > fiscal policy
    EU policies and themes > Policies & related activities > economic and financial affairs > EMU/EMS/euro
    Subjects for EU documents: UNSPECIFIED
    EU Series and Periodicals: UNSPECIFIED
    EU Annual Reports: UNSPECIFIED
    Conference: European Union Studies Association (EUSA) > Biennial Conference > 2007 (10th), May 17-19, 2007
    Depositing User: Phil Wilkin
    Official EU Document: No
    Language: English
    Date Deposited: 26 Jun 2008
    Page Range: p. 23
    Last Modified: 15 Feb 2011 17:51

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