Whereas this year has already seen the full effectiveness of the constitutional debt cap on a national level, the debt brake won't be binding for the federal states until 2020. In contrast to the debt cap on state level, the federal government has a structural leeway, which permits a deficit of 0.35 per cent of GDP. Enshrined in Article 109 III of Germany's Basic Law in 2009, the debt cap envisages a long transitional period, which has raised doubts among many decision-makers about its credibility. Against this backdrop, ZEW conducted a survey among members of all 16 German state parliaments in 2015–16, after having carried out a first survey in 2011–2012. The surveys were conducted in collaboration with the University of Mannheim as part of the collaborative research project "Die politische Ökonomie der Reformen" ("The political economy of the reforms"). This policy brief analyses the results of the second survey on current issues regarding German fiscal federalism (debt brake and the evaluation of state mergers).
Blesse, Sebastian, Friedrich Heinemann and Eckhard Janeba (2016), Einhaltung der Schuldenbremse und Bewertung von Länderfusionen – Ergebnisse einer Umfrage in allen 16 Landesparlamenten, ZEW policy brief No. 16-06, Mannheim. Download