JOURNAL ARTICLE
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Bailout- und Bonitätseffekte in der Wirtschafts- und Währungsunion
Journal of Contextual Economics – Schmollers Jahrbuch, Vol. 115 (1995), Iss. 4 : pp. 605–622
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Heinemann, Friedrich
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Article 122 [Solidarity]
Weber, Albrecht
Pilz, Stefan
2021
https://doi.org/10.1007/16559_2021_2 [Citations: 0]
Abstract
The Maastricht Treaty, with its definition of the European Economic and Monetary Union (EMU), has changed the incentives for national debt. Even though it has been tried to keep member states responsible for their national debt, the analysis shows that discipline solely from market pressure cannot be expected. In particular, the increasing redistribution through the EU budget weakens market discipline. The mechanism of political discipline of the Treaty is provided with an effective sanction in the second stage of EMU, an equivalent sanction in the third stage of EMU is missing, however. Therefore, there is the danger that debt incentives become powerful especially after the introduction of a common European currency.