A euro-area country that runs very large public deficits or shows a persistently high and rising debt-to-GDP
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A euro-area country that runs very large public deficits or shows a persistently high and rising debt-to-GDP ratio violates the provisions of a 2012 treaty aimed at promoting fiscal stability. Explain how such fiscal violations pose a challenge for the ECB in the form of moral hazard.
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The 2012 treaty youre referring to is likely the Fiscal Stability Treaty also known as the Fiscal Compact which aimed to strengthen fiscal discipline ...View the full answer
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Related Book For
Money Banking And Financial Markets
ISBN: 9781260226782
6th Edition
Authors: Stephen Cecchetti, Kermit Schoenholtz
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