| Summary: | 碩士 === 逢甲大學 === 財稅學系 === 105 === In this study, we used Panel Vector Autoregression model to analyze the impact of fiscal rules on the fiscal deficit in the EU member countries. We select 20 advanced EU member countries over 1996-2015 period. And all of the variable would be decomposed into two groups, the high government effectiveness group and the other government effectiveness group, which is depending on their relative government effectiveness that we can analyze whether the effect of fiscal rules is different from the two groups.
The empirical results indicate that fiscal rules and government effectiveness have a negative effect on the fiscal deficit but no significant in all member countries group. The fiscal rules and government effectiveness have a positive effect but no significant on the fiscal deficit in the other government effectiveness group. However, fiscal rules and government effectiveness have both negative and significant effect on fiscal deficits. In other words, when fiscal rule combined with a high efficiency of government, the fiscal rules will have negative and significant effect on the fiscal deficit.
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