The Impact of the EU’s Economic and Fiscal Policy Measures on the Budgeting Process of Estonia

After the global financial crisis in 2008-2010, the governance framework of the European Union’s economic and fiscal policy has undergone several changes. The Stability and Growth Pact - the core of the EU’s fiscal governance framework - has been reinforced by the “sixpack”, the “two-pack”, the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union, and the rules are grounded in the European Semester process. After 10 years since the initial major changes were introduced into the EU’s legislative framework and given the current times of fiscal uncertainty as well as ongoing discussions on revising and improving the Stability and Growth Pact rules once again, it is of utmost importance to understand the impacts these past reforms have had on member states in the first place. The paper serves two purposes. First and foremost, the main goal of the paper is to build on the existing knowledge on Europeanization in order to bring into one single framework a whole set of different policy measures and their potential impact on the member state’s budgeting processes. Secondly, the theoretical discussion is followed by an empirical case study of Estonia. The case study not only illustrated and mapped out potential impacts that the EU’s economic and fiscal governance measures can have on a national budgetary process and demonstrated the potential degree of domestic change in response to these various policy measures, but also provided preliminary insights in the possible mediating factors that could additionally influence domestic adaption.