This paper intends to fill two gaps in the Optimal Currency Area literature. First of all, Mundell's original idea has very little formalmodel theoretical underpinning. Second, it almost exclusively views countries contemplating monetary unification as single economies. We question this view and...

In this paper, we set out to examine an efficient fiscal-policy framework for a monetary union. We illustrate that fiscal policy’s bias toward budget deficit only temporarily ceased at the end of the 20th century as European countries endeavored to qualify for euro-zone membership, which...

Paper deals with the European Monetary Union from perspective of Post Keynesian school of economic thought. It discusses separately arguments often proposed by mainstream economists. After the brief introduction, which highlights main differences between mainstream and Post Keynesian economic...

The European Union (EU) accepted ten new member states (NMS) in 2004. These countries, mostly former socialist countries, have had to adjust their economic policies to the EU’s standards. Perhaps most difficult has proven to be fiscal policy whereby NMS must comply with the Stability and...

This paper deals with the growth accounting method used for derivation of so called net fiscal effort. Net fiscal effort can then provide a clue whether fiscal policy is expansionary or not and together with the data about economic performance can answer the question of pro- or anti-cyclicality...

The position of Czech public finances has been pronounced unsustainable by economists, while politicians claim more or less the opposite. Correct judgment is complicated by the purposeful use of arguments by the two groups in disagreement, by use of different methodology to collect the data and...

In this paper, we track fiscal authority behaviour in the ten new EU member states (NSM) in the period which immediately preceded their EU accession. We first present basic stylized facts about public budgets of those countries. The paper then analyses reasons which led to periods of fiscal...

This paper tracks the behavior of the fiscal authorities of the ten new EU member states in the period that immediately preceded their EU accession in 2004. We analyze the reasons that led to fiscal consolidations in the new members and present evidence from the preaccession economic and...

We evaluate proposals for independent fiscal authority put forward as a solution to excessive public spending. Our main conclusion is that moving the responsibility to set broad measures of fiscal policy from the hands of government to an independent fiscal council is not necessarily welfare...

The paper deals with the theoretical and practical aspects of the taxation of labor and capital in the Czech Republic. The authors show that if the low flexibility of Czech labor is taken into account, progressive taxation could stimulate a higher supply of labor than would a linear tax. The...