The purpose of the project is to analyse fiscal forecasts for the European Union states. The Stability and Growth Plan imposes the obligation of maintaining a deficit of the public finance sector below the threshold of 3% of the GDP on the national cabinets. Exceeding his threshold results in launch of the excessive deficit procedure, which induces repair activities or economic sanctions.
The experiences of the debt crisis of 2012 and 2013 have strongly uprooted its credibility: forecasts presented by the European Commission, the International Monetary Fund and the OECD systematically overestimated the rate of reduction of the deficit in the most indebted economies, i.e. Italy, France, Spain and Portugal. The performed analyses have shown that the problem persists: international institutions are still presenting wishful forecasts. Analyses also refer to errors in forecasts for cabinets carried out by groups sceptical with respect to further integration in Poland and in Hungary.
Open institutional conflicts pose a risk of application of double standards in economic assessment. However, estimation of models shows that no attempts at exerting pressure on such states are observed. The study has also disclosed problems with forecasting the situation of small economies, e.g. of Ireland and the Baltic States. Limited knowledge about them generated incentives for the local governments to allow international entities to optimise taxes at the cost of the rest of the community. Studies carried out as part of the project were published in the Baltic Journal of Economics and the Central European Economic Journal.