Monetary and Fiscal Policies in Canada: Some Interesting Principles for EMU?

Choosing a well-designed framework for fiscal and monetary policies is a challenge for economic authorities. Although they have chosen the same objectives to promote economic growth—price stability and fiscal sustainability—the Canadian and European economic authorities have adopted different frameworks in which to attain them. The author examines some principles of the Canadian framework that have gained broad public support and provide a good degree of macroeconomic stabilization, and examines whether the European authorities might wish to consider adopting some of those principles.