Tomasz Uryszek

University of Lodz

Poland

tomasz.uryszek@uni.lodz.pl

Sustainable public FInance – illusion or reality? Evidence from old EU member states

ABSTRACT. The main goal of the article is to investigate the level of sustainability of public finance in short and long run in the old EU member states. It is accompanied by the following hypotheses: (1) the old EU economies are able to generate primary fiscal surpluses and in this way they can aim to achieve sustainability of their public finances, (2) the last financial crisis and high costs of debt service were the obstacles in aiming at the sustainability of public finance. The research method is based on the primary fiscal balances and debt service costs. The research period covers the years 1996-2015. Data were taken from Eurostat and the European Commission’s Directorate General for Economic and Financial Affairs. The outcomes of the research prove the hypotheses were correct.

Received: February, 2015

1st Revision: April, 2015

Accepted: May, 2015

DOI: 10.14254/2071-

8330.2015/8-1/2

JEL Classification: H62, H63

Keywords: public finance, primary deficit, public debt, sustainability, old EU Member States