Fixing a Design Error: How the Cyclically Adjusted Budget Balance Becomes Democratically Legitimate and Sustainable
Abstract The optimisation of the cyclical adjustment procedure under the German debt brake should focus on how to contribute to a democratically legitimate and sustainable fiscal policy. In this article, we discuss four criteria that should be satisfied: The method must (i) be sufficiently determine...
| Main Authors: | , |
|---|---|
| Format: | Article |
| Language: | deu |
| Published: |
Springer
2022-11-01
|
| Series: | Wirtschaftsdienst |
| Online Access: | https://doi.org/10.1007/s10273-022-3323-0 |
| _version_ | 1811208069586092032 |
|---|---|
| author | Florian Schuster Philippa Sigl-Glöckner |
| author_facet | Florian Schuster Philippa Sigl-Glöckner |
| author_sort | Florian Schuster |
| collection | DOAJ |
| description | Abstract The optimisation of the cyclical adjustment procedure under the German debt brake should focus on how to contribute to a democratically legitimate and sustainable fiscal policy. In this article, we discuss four criteria that should be satisfied: The method must (i) be sufficiently determined, (ii) take the current state of research into account, (iii) incentivise a policy that enhances supply-side capacities, and (iv) be transparent. We show that today’s form of the cyclically adjusted budget balance does not satisfy these criteria, and we propose a reform. Finally, we discuss several recent trends in German fiscal policy, questioning whether such a reform can save the debt brake’s plausibility. |
| first_indexed | 2024-04-12T04:16:05Z |
| format | Article |
| id | doaj.art-cf72151ed08a44d6adc9583e55a6106a |
| institution | Directory Open Access Journal |
| issn | 1613-978X |
| language | deu |
| last_indexed | 2024-04-12T04:16:05Z |
| publishDate | 2022-11-01 |
| publisher | Springer |
| record_format | Article |
| series | Wirtschaftsdienst |
| spelling | doaj.art-cf72151ed08a44d6adc9583e55a6106a2022-12-22T03:48:24ZdeuSpringerWirtschaftsdienst1613-978X2022-11-011021182682910.1007/s10273-022-3323-0Fixing a Design Error: How the Cyclically Adjusted Budget Balance Becomes Democratically Legitimate and SustainableFlorian Schuster0Philippa Sigl-Glöckner1c/o Innovation in Politics Institute, Dezernat Zukunftc/o Innovation in Politics Institute, Dezernat ZukunftAbstract The optimisation of the cyclical adjustment procedure under the German debt brake should focus on how to contribute to a democratically legitimate and sustainable fiscal policy. In this article, we discuss four criteria that should be satisfied: The method must (i) be sufficiently determined, (ii) take the current state of research into account, (iii) incentivise a policy that enhances supply-side capacities, and (iv) be transparent. We show that today’s form of the cyclically adjusted budget balance does not satisfy these criteria, and we propose a reform. Finally, we discuss several recent trends in German fiscal policy, questioning whether such a reform can save the debt brake’s plausibility.https://doi.org/10.1007/s10273-022-3323-0 |
| spellingShingle | Florian Schuster Philippa Sigl-Glöckner Fixing a Design Error: How the Cyclically Adjusted Budget Balance Becomes Democratically Legitimate and Sustainable Wirtschaftsdienst |
| title | Fixing a Design Error: How the Cyclically Adjusted Budget Balance Becomes Democratically Legitimate and Sustainable |
| title_full | Fixing a Design Error: How the Cyclically Adjusted Budget Balance Becomes Democratically Legitimate and Sustainable |
| title_fullStr | Fixing a Design Error: How the Cyclically Adjusted Budget Balance Becomes Democratically Legitimate and Sustainable |
| title_full_unstemmed | Fixing a Design Error: How the Cyclically Adjusted Budget Balance Becomes Democratically Legitimate and Sustainable |
| title_short | Fixing a Design Error: How the Cyclically Adjusted Budget Balance Becomes Democratically Legitimate and Sustainable |
| title_sort | fixing a design error how the cyclically adjusted budget balance becomes democratically legitimate and sustainable |
| url | https://doi.org/10.1007/s10273-022-3323-0 |
| work_keys_str_mv | AT florianschuster fixingadesignerrorhowthecyclicallyadjustedbudgetbalancebecomesdemocraticallylegitimateandsustainable AT philippasiglglockner fixingadesignerrorhowthecyclicallyadjustedbudgetbalancebecomesdemocraticallylegitimateandsustainable |