FISCAL CONSOLIDATION EFFECT IN THEORY AND PRACTICE
FISCAL CONSOLIDATION EFFECT IN THEORY AND PRACTICE

Summary/Abstract: This paper focuses on the issues of fiscal policy and specific institutional mechanism represented by the fiscal consolidation that represent the powerful tools of preventing the debt crisis and strengthening fiscal discipline. The paper analyzes the cases of USA, Japan, and EU countries which implemented fiscal consolidation policy with a varying degree of success. The main value-added of our paper is the explanation and reasoning for the relevance of implementing fiscal policy in a crisis economy through “institutional arrangement” of fiscal rules into legal procedures of debt and fiscal strategy. The paper discusses the experience of Ukrainian fiscal consolidation based on up-date statistics and comes up with analytical results and discussions that might be interesting for both policy-makers and “big sharks” of the business community.

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