| Summary: | Austerity is one of the most controversial policies in Europe. Fiscal rules are a key political institution that entrench austerity as a permanent feature of government budgetary policy. These rules fix numerical targets to constrain government budgets under the assumption that, in the long run, this might help to prevent fiscal crisis. In the last 30 years, the number of countries using fiscal rules has exploded. This thesis studies the political process leading to the creation of fiscal rules. Contrary to previous research, this thesis considers explanations coming both from national and international politics. It is composed of three articles. The first uses time series analysis in a European panel to arbitrate between different mechanisms that could lead political actors to adopt fiscal rules. It finds that fiscal rules are strengthened when countries are facing fiscal stress over an extended period or when governments are in a position of relative weakness toward European institutions. The latter result suggests that fiscal rules might diffuse through coercive diplomacy. The second paper uses a process tracing approach to test the possibility that the creation of fiscal rules is driven by the coercive diplomacy of the IMF and the EU. Our conclusion is that the coercive diplomacy of these two actors explains a large proportion of all fiscal rules existing in the world today. The final paper takes this result and compares the impact of fiscal rules on debt and bond yields between those that are externally-coerced and those that are nationally-driven. The conclusion is that externally-coerced fiscal rules do not help to control government debt and favour fiscal gimmickry. The main conclusion of the thesis is that a large fraction of fiscal rules are the result of coercive diplomacy and that these rules are less efficient than those which result from national politics.
=== Arts, Faculty of === Political Science, Department of === Graduate
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