Sustainability of Public Debt and Budget Deficit: Panel cointegration analysis for the European Union Member countries

摘要: In this study, we analyse the sustainability of fiscal policy EU member countries within panel cointegration and error-correction frameworks. Unlike previous empirical papers in area, apply test for between primary budget deficit public debt defined GDP ratios. Based on results, conclude that is consistent with intertemporal constraint, i.e., it sustainable fifteen over period from 1970 to 2004. Hence, show balance exhibits a significant structural change year 1992, when Banerjee Carrion-i-Silvestre (2006) break relationship. next step, search politico-economic factors which explain variation among European countries. We evidence rules have positive effect improvement position governments