It is often argued that fiscal stabilisation in the euro area compares unfavourably with the US, not least because of the perceived limitations of the Stability and Growth Pact. This paper qualifies this perception by taking a closer look at fiscal policy making since the mid-1990s. It examines...

The Workshop "The role of fiscal rules and institutions in shaping budgetary outcomes" organized by the Directorate-General for Economic and Financial affairs of the European Commission on 24 November 2006 in Brussels aimed at enriching the debate on the fiscal arrangements and improving the...

Understanding the behaviour of private consumption is crucial for the assessment of the economic situation in the short and the medium term. As the largest expenditure component of GDP, household spending plays a central role in the cyclical fluctuations of activity around its long-term growth...

Most of the reforms discussed within the framework of the Lisbon strategy will benefit public finances in the long term. However, in the short-term, there could a trade-off between some structural reforms and budgetary discipline. This possible tension between reforms and fiscal discipline was...

This paper analyses how adjustment dynamics, in an environment with some degree of price and wage rigidity, may create and strengthen asymmetric developments in a monetary union. It presents a simple illustrative model of adjustment dynamics that reproduces quite nicely actual developments in...