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Banking fragility rooted in justice failures Evidence from Ukraine
Policy Contribution

Applying nominal expenditure rules in the euro area

by Clemens Fuest / Daniel Gros
27 March 2019

Applying nominal expenditure rules in the euro area

Clemens Fuest / Daniel Gros

In the debate on euro area fiscal governance, the current deficit rules of the EU have repeatedly been criticised to have a pro-cyclical effect, leading to overly lax fiscal policies in good times and a too restrictive regime in bad times. An analysis by EconPol researchers Clemens Fuest and Daniel Gros shows that most major EU countries are over-spending at a level not compatible with spending rules for sustainable public finances.

Access this EconPol Europe Policy Brief here.


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Applying nominal expenditure rules in the euro area