Conferences and Working Groups

Fiscal Policy in the EU Member States

This project examines the impact of private financial markets, especially those for government bonds, on national government compliance with the EU's fiscal rules. These rules, initially included in the Maastricht Treaty and now embodied in the Stability and Growth Pact, are vital for new member states seeking to participate in EMU.

This project will treat the role of private markets in the EU in a comparative context, in terms of assessing the impact of private markets on government compliance with a wider range of international standards, such as data dissemination, accounting standards, and bank capital adequacy. The project participants will conduct three types of research: interviews with capital market participants and government officials (London and Frankfurt); surveys of financial market participants, conducted on-line; and statistical analyses of the determinants of interest rates on government bonds, with a focus on the impact of international and EU rules on these rates. As such, this research will identify the conditions under which the EU can (or should) rely on private markets to help enforce its policies. Is the threat of sanction, in the form of higher interest rates, sufficient to promote compliance? Or is private market discipline fickle? Funds for the project will also bring to campus two visiting speakers working in the area of international financial Standards, with particular reference to the EU.