Essays on Fiscal Federalism in the EMU: Externalities and Policy Interactions among Governments.

Summary The purpose of this research is to theoretically assess the extent to which fiscal federalism, understood as the joint intervention of national governments and a supra-national fiscal authority, can address fiscal externalities in the European monetary union. In general, the focus is on the policy interactions that arise from the relationships between the different levels of fiscal authority. In the first two chapters, we focus on a mechanism for correcting the effects of cyclical shocks on national economies, in a framework where the fight against excessive deficits is of crucial importance. In the third chapter, we assess the interest of a mechanism to correct the effects of tax competition on the redistributive measures implemented in each country. We then show that central government intervention, in the form of financial transfers, allows national governments to pursue their specific objectives while correcting the fiscal externalities that affect their decisions. These financial transfers, which are allocated according to the specificities of each country, thus make it possible to respond in part to the limitations of the organization of European public finances.