Reconciling fiscal sovereignty and fiscal discipline in the EU: general considerations and case study analysis

Abstract

The thesis examines Maastricht convergence criteria set in the TEU to ensure fiscal discipline among EU member states with a focus on government debt and budget deficit criteria that requires member states to keep their budget deficit below 3% of GDP and their public debt below 60%. The thesis provides comprehensive analysis of established legal framework of maintenance of fiscal discipline and its implications on fiscal sovereignty of EU member states. Through application of economic and comparative analysis on three EU member states – Italy, Greece and Belgium, research focuses on identification of flexibility of government debt and budget deficit criteria through analysis of each of three states fiscal indicators. Based on the aftermath of financial crisis of 2008 and concluded extensive flexibility of Maastricht convergence criteria that is governed through the rules established in SGP, the thesis provides legal analysis on the existing weak spots in the established set of rules, problematic aspects based on the lessons learned in the past with a focus on recently proposed new fiscal rules.