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Did the Maastricht treaty matter for macroeconomic performance? A difference‐in‐difference investigation
Author(s) -
Baskaran Thushyanthan
Publication year - 2009
Publication title -
kyklos
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.766
H-Index - 58
eISSN - 1467-6435
pISSN - 0023-5962
DOI - 10.1111/j.1467-6435.2009.00439.x
Subject(s) - maastricht treaty , economics , treaty , significant difference , international economics , difference in differences , european union , political science , european integration , medicine , econometrics , law
SUMMARY We explore the impact of the Maastricht treaty on fiscal and macroeconomic outcomes in the EU with the difference‐in‐difference methodology. Our dataset covers 23 OECD countries over the 1975–2006 period. EU 15 countries are classified as the treatment and eight non‐EU OECD countries as the control group. The results indicate that the provisions in the Maastricht treaty have been either irrelevant or even harmful for fiscal and macroeconomic developments in the EU. Evidence for a detrimental impact of the Maastricht criteria is particularly strong for the period after the start of the third stage of EMU.