Ahtiala, Pekka - In: Journal of Economic Integration 15 (2000), pp. 397-417
The Maastricht convergence criteria of the Economic and Monetary Union of Europe stipulate that the public debt of a member country maybe at most 60 percent, and the fiscal deficit at most 3 percent of the GNP, which has led member governments to contract their expenditures. A simple two-country...