Fiscal policy in Central and Eastern Europe with real time data: Cyclicality, inertia and the role of EU accession

This paper evaluates the cyclicality, inertia and effect of EU accession on fiscal policy in Central and Eastern Europe using a real time dataset. Budget balances are found to react in a stabilising way to economic activity, and they are less inert than is typically found in Western Europe. There is clear evidence of a fiscal loosening in the run-up to EU accession. This began in 1999 in larger central European countries, often identified as â€œfront-runners. The other seven began loosening in 2001, after the Nice Treaty had been agreed and their EU entry confirmed. For both sets of countries, this loosening cumulatively amounts to some 3% of GDP.ÂÂÂ ÂÂÂ ÂÂÂ ÂÂÂ ÂÂÂ ÂÂÂ ÂÂÂ ÂÂÂ ÂÂÂ ÂÂÂ ÂÂÂ

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Year of publication:	2009-07
Authors:	Lewis, John
Institutions:	de Nederlandsche Bank
Subject:	Central and Eastern Europe \| Fiscal Policy \| Real Time Data \| EU Accession

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Extent:	application/pdf
Series:	DNB Working Papers.
Type of publication:	Book / Working Paper
Language:	English
Classification:	E62 - Fiscal Policy; Public Expenditures, Investment, and Finance; Taxation ; H6 - National Budget, Deficit, and Debt ; E61 - Policy Objectives; Policy Designs and Consistency; Policy Coordination
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10004963329