Fiscal responsibility between the Fiscal Compact and the Recovery Fund

Abstract

Abstract Between the sovereign debt crisis and the coronavirus pandemic, eurozone countries witnessed two different logics for preserving fiscal sustainability, with austerity being dominant for most of the 2010s, and a more expansive-oriented approach coming to the foreground in more recent years. This chapter highlights how this gradual change over time runs parallel to the shift from responsibility to responsiveness analysed in previous chapters. It theorizes that a paradigmatic change occurred among key actors in European economic governance and finds empirical corroboration for this insight. The analysis focuses on the arguments by which budgetary policies are justified in the name of long-term fiscal sustainability and traces the variations in content. The chapter ends with a reflection on the implications of changing notions of fiscal responsibility for responsiveness.