REAL

Can fiscal sovereignty be reconciled with fiscal discipline?

Kopits, George (2012) Can fiscal sovereignty be reconciled with fiscal discipline? Acta Oeconomica, 62 (2). pp. 141-160. ISSN 0001-6373

[img] Text
aoecon.62.2012.2.1.pdf
Restricted to Repository staff only until 30 June 2032.

Download (217kB)

Abstract

Over the past two decades, international bond markets have become the chief disciplinarian of fiscal policy, displacing the International Monetary Fund and the European Union in this role. This trend culminated in the wake of the global financial crisis, as countries that had indulged in moral hazard and fiscal profligacy during the Great Moderation were vulnerable to a sharp rise in sovereign risk premium and in some cases to loss of market access. The article compares the response of new governments in Hungary and United Kingdom to restore policy credibility. A major lesson is that governments that adopt a rules-based fiscal framework, including fiscal watchdogs and transparency norms, are far more successful in anchoring fiscal expectations and in achieving fiscal sovereignty than those that do not.

Item Type: Article
Subjects: H Social Sciences / társadalomtudományok > H Social Sciences (General) / társadalomtudomány általában
Depositing User: xKatalin xBarta
Date Deposited: 20 Dec 2016 08:50
Last Modified: 20 Dec 2016 08:50
URI: http://real.mtak.hu/id/eprint/43558

Actions (login required)

Edit Item Edit Item