EMU and the public sector

Other Publications, Studies 67 Tuovi Allén

The adaptation of the public sector to a different operating environment under EMU conditions is crucial for the development of national economies across the euro area. Its importance is underscored by the fact that the fiscal convergence criteria and the Stability and Growth Pact are central to the functioning of Economic and Monetary Union (EMU).

In most EU countries, the public sector accounts for a larger share of output and employment than either private services or manufacturing. As a result, changes in the size and scope of the public sector have significant effects on overall economic growth and employment at the national level. (AI translation)

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