The performativity of potential output: pro-cyclicality and path dependency in coordinating European fiscal policies

Heimberger, Philipp; Kapeller, Jakob

doi:10.1080/09692290.2017.1363797

Cited by 50 publications

(24 citation statements)

References 57 publications

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“…In Europe, the concept had always been present, after Kaldor, in Keynesian and post-Keynesian literature, e.g. Ledesma -Thirlwall (2000), Fatas -Summers (2018), Heimberger -Kapeller (2017), Heimberger (2019).…”

Section: Fiscal Policy In a Sectoral Analytical Frameworkmentioning

confidence: 99%

Coordination(?) between Branches of Economic Policy across Euro Area

Lehmann¹,

Nagy²,

Szalai³

et al. 2020

Financial and Economic Review

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In our study we present the coordination between the two main pillars of economic policy-monetary policy and fiscal policy-across the euro area. Growth in the euro area has noticeably decelerated in the past three decades, meaning the economy of the euro area has departed significantly from the logic of the Maastricht criteria. In addition, the lack of a common budget at euro area level and the fact that the oft-conflicting rules overlook sectoral interrelationships also point to the existence of a systemic problem. The difficulties have become increasingly evident in recent years as even the ultra-loose monetary policy has failed to stimulate economic growth significantly. This adverse process was intensified further by fiscal policy, which was intended to be consistent with the fiscal rules formulated in line with Maastricht criteria and can be considered tight, overall, at the euro area level. In recent months, even the policymakers of the European Central Bank have embarked on an open debate with regard to the role of policy branches. In the current political and legal framework, the ECB may be left with limited leeway for easing monetary conditions. In light of all these factors, there may be a need for a more active fiscal policy to stimulate the euro area economy, which, however, may sharpen the debate between the policymakers of individual Member States.

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Section: Fiscal Policy In a Sectoral Analytical Frameworkmentioning

confidence: 99%

Coordination(?) between Branches of Economic Policy across Euro Area

Lehmann¹,

Nagy²,

Szalai³

et al. 2020

Financial and Economic Review

View full text Add to dashboard Cite

show abstract

“…Thereby, the ways in which economists influence public opinion and policy are complex and multi-faceted (Hirschman & Berman, 2014). It includes research on the political power of economic ideas (Hall, 1989), the performativity of economic models (Callon, 2006;Cochoy et al, 2010;Heimberger & Kapeller, 2017) as well as the political impact of 'economic imaginaries' (Jessop, 2013;Sum & Jessop, 2013).…”

Section: The Impact Of Economics and The Question Of Consensus Among mentioning

confidence: 99%

Divided We Stand? Professional Consensus and Political Conflict in Academic Economics

Beyer

Pühringer

2019

SSRN Journal

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In this paper we address the issue of the role of ideology and political preferences of publically engaged economists and contribute to the debate on consensus in economics. To do so, we conduct a social network analysis on the signatories of economist petitions, which we identify as one channel for economists to exert public influence. We base our analysis on a sample of 77 public policy petitions and presidential anti-/endorsement letters from 2008-2017 in the United States with more than 6,400 signatories and check the robustness of our results with six sub-networks. Our contribution is twofold: On the one hand we provide an extended empirical basis for the debate on consensus in economics and the role of politics and ideology in economics. On the other hand we provide a viable tool to trace the ideological leaning of (prospective) economist petitions and economists based on the social structure of petition networks.

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“…"Using the cognitive schemas at their disposal," technocratic bricoleurs always "construct strategies of action based on pre-constructed ideational and political institutions" (Carstensen 2011, 147). Supposedly neutral "rational speculation" based on "scientific procedures" (Caramani 2017, 62) is thus invariably colored by the prevalent theoretical or policy consensus (Braun 2014;Blyth and Matthijs 2017;Heimberger and Kapeller 2017). Considering that securitization and market-based finance had played a key role in the financial crisis, CMU would have been unlikely to emerge as a policy solution had it not been for the resilience of the pre-crisis consensus among European technocrats that properly regulated financial markets tend towards efficiency (Mügge 2013;Schmidt and Thatcher 2013).…”

Section: Integration Of Core State Powers and The Destruction Of Macrmentioning

confidence: 99%

Fiscal fault, financial fix? Capital Markets Union and the quest for macroeconomic stabilization in the Euro Area

Braun

Hübner

2018

Competition & Change

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This paper argues that Capital Markets Union-the EU's attempt to establish a more marketbased financial system-is a result less of financial policymaking than of macroeconomic governance in a politically fractured polity. The current governance structure of Economic and Monetary Union (EMU) severely limits the capacity of both national and supranational actors to provide a core public good, macroeconomic stabilization. While member states have institutionalized fiscal austerity and abandoned other macroeconomic levers, the European polity lacks the fiscal resources necessary to achieve stable macroeconomic conditions: smoothing the business cycle, ensuring growth and job creation, and mitigating the impact of asymmetric output shocks on consumption. Capital Markets Union, we argue, is an attempt by European policymakers to devise a financial fix for this structural capacity gap. Using its regulatory powers, the European Commission, supported by the European Central Bank (ECB), seeks to harness private financial markets and instruments to provide the public policy good of macroeconomic stabilization. We trace how technocrats, think tanks, and financial-sector lobbyists, through the strategic use of knowledge and expertise, established securitization and market-based finance as solutions to EMU's governance problems.

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The performativity of potential output: pro-cyclicality and path dependency in coordinating European fiscal policies

Cited by 50 publications

References 57 publications

Coordination(?) between Branches of Economic Policy across Euro Area

Coordination(?) between Branches of Economic Policy across Euro Area

Divided We Stand? Professional Consensus and Political Conflict in Academic Economics

Fiscal fault, financial fix? Capital Markets Union and the quest for macroeconomic stabilization in the Euro Area

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