Una stima degli effetti macroeconomici del Fiscal Compact

This paper analyses the effects that the rules imposed by Fiscal Compact may have on the public debt/GDP ratio trend. Fiscal Compact prescribes compliance with two main rules concerning public finance: (i) the need for a substantial balanced budget, or more precisely, not allowing the structural deficit of the public sector to exceed 0.5% of GDP over an economic cycle; and (ii) the fact that the public debt/GDP ratio falls each year by one twentieth of the distance between its actual level and the 60% target-threshold set out in the Maastricht Treaty. The paper shows that, if the income trend is affected by changes in the autonomous components of aggregate demand, a restrictive fiscal policy following these rules will not necessarily lead to a reduction in the public debt/GDP ratio. Moreover, even if this reduction were to be eventually achieved, it would be at the cost of substantial net wealth losses in the private sector and impoverishment of the population. The conclusion drawn is that the effects produced by persistent public surpluses aimed at reducing the public debt/GDP ratio will be different from those considered in a traditional theoretical approach and will generate 'perverse' patterns of that ratio.