Stability in EMU

TL;DR

This paper examines the stability and application of debt and deficit ceilings in the Maastricht Treaty, analyzing their role during the introduction and ongoing operation of the euro.

Contribution

It provides a detailed analysis of the controversy and practical implications of the Maastricht criteria for fiscal stability in the EMU.

Findings

Debate on the role of Maastricht criteria in euro introduction

Analysis of criteria application in stable EMU regime

Implications for fiscal policy and stability

Abstract

The public debt and deficit ceilings of the Maastricht Treaty are the subject of recurring controversy. First, there is debate about the role and impact of these criteria in the initial phase of the introduction of the single currency. Secondly, it must be specified how these will then be applied, in a permanent regime, when the single currency is well established.