Rule Based Budgeting and Fiscal Institutions after the Crisis

The financial crisis of 2008 raised the fear from great depression. That was why European governments launched fiscal stimuli never seen before. The magnitude of public spending and the narrowing of bond markets took these countries close to a serial of debt crises. The study surveys the institutional similarities and differences between the centre and the periphery of EU in budgeting. What are the fiscal rules and fiscal councils? How are they applied in Europe? Can these items and institutions prevent any debt problem or have indebted countries to return to balanced budget? What to conclude from the failure of precrisis rules? Coordination, harmonization or watchdog function of fiscal councils should become the most important? What is the role of independence of fiscal councils in rebalancing of public finances in Europe