Reforming the EU Fiscal Framework

Abstract

The paper has benefited immensely from review and comments by many other IMF staff colleagues. We gained insights from participants at numerous presentations of this work, including at the European Commission and in meetings with the authorities of several EU member states. Estefania Cohn Bech, Morgan Maneely, and Christine Rubio provided invaluable help with data management and document production. Thanks are also due to Lorraine Coffey for leading the editorial process.The Departmental Paper Series presents research by IMF staff on issues of broad regional or crosscountry interest. The views expressed in this paper are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

What is new in the European fiscal framework under discussion?

“…With respect to the EU fiscal framework, Blanchard, Leandro, and Zettelmeyer (2021) remind us that even the successive amendments to deal with unpredictable events did not prevent damage to public investment. Furthermore, the framework hampered the support to navigate the Global Financial Crisis.…”