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Bringing Macroeconomics Back into the Political Economy of Reform: the Lisbon Agenda and the ‘Fiscal Philosophy’ of EMU.
- Source :
- Journal of Common Market Studies; Mar2007, Vol. 45 Issue 1, p81-103, 23p, 3 Charts, 3 Graphs
- Publication Year :
- 2007
-
Abstract
- The Lisbon Strategy supports reform of Member States' tax-benefit systems while the ‘fiscal philosophy’ of the EMU postulates that governments should allow only automatic stabilizers, built into tax-benefit systems, to smooth aggregate income. We ask whether these two pillars of EU economic governance are compatible. By exploring how structural reforms affect fiscal stabilization, we complement a political economy literature that asks whether fiscal consolidation fosters or hinders structural reforms. Using EUROMOD, a tax-benefit model for the EU-15, we identify the connections between specific tax and benefit reforms and the size of the stabilizers. We conclude that Lisbon-type reforms may worsen the stabilizing capacity of tax-benefit systems. [ABSTRACT FROM AUTHOR]
- Subjects :
- TAX reform
TAX benefits
ECONOMIC stabilization
ECONOMIC conditions in Europe
Subjects
Details
- Language :
- English
- ISSN :
- 00219886
- Volume :
- 45
- Issue :
- 1
- Database :
- Complementary Index
- Journal :
- Journal of Common Market Studies
- Publication Type :
- Academic Journal
- Accession number :
- 23905726
- Full Text :
- https://doi.org/10.1111/j.1468-5965.2007.00704.x