This paper analyses the shortcomings of the current budget rules for the Bundeslauml;nder, especially the definition of public investment that is used as a deficit ceiling in Germany. Two alternative budget rules are analysed, the Swiss debt brake as well as a version incorporating a golden rule...

In this paper, we compare growth and welfare effects of various budget rules within an endogenous growth model with productive public capital, utility enhancing public consumption and public debt. We find that introducing a fixed deficit regime does not affect the long run growth rate compared...

In this paper, we compare growth and welfare effects of various budget rules within an endogenous growth model with productive public capital, utility enhancing public consumption and public debt. We find that a fixed deficit regime does not affect the long run growth rate compared to a balanced...