TY  - RPRT
A1  - Weichenrieder, Alfons J.
A1  - Zimmer, Jochen
T1  - Euro membership and fiscal reaction functions : [Version 10 February 2013]
N2  - Using fiscal reaction functions for 3a panel of actual euro-area countries the paper investigates whether euro membership has reduced the responsiveness of countries to increases in the level of inherited debt compared to the period prior to succession to the euro. While we find some evidence for such a loss in prudence, the results are not robust to changes in the specification, as for example an exclusion of Greece from the panel. This suggests that the current debt problems may result to a large extent from pre-existing debt levels prior to entry or from a larger need for fiscal prudence in a common currency, while an adverse change in the fiscal reaction functions for most countries does not apply.
KW  - debt sustainability
KW  - fiscal reaction function
KW  - euro area
Y1  - 2013
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/34805
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-348058
IS  - Version 10 February 2013
ER  -