Abstract
Despite the growing significance of fiscal rules, there is little research about tools and practices of enforcement at the local level. Addressing this knowledge gap, this chapter makes three contributions: first, we review the literature on regulatory enforcement in the ‘public-to-private’ context and discuss six key insights. Second, we provide an empirical overview of enforcement instruments across 21 European countries and discuss them in light of those key insights. Third, we present findings from an in-depth over-time analysis of enforcement practices in Germany’s largest state, North Rhine-Westphalia. We find that European supervisory bodies have a range of instruments that broadly follow the logic of the ‘enforcement pyramid’ at their disposal, but there is substantial cross-national variation in the instruments used. The case study reveals a ‘back and forth’ enforcement style alternating between strengthening and loosening rules and enforcement measures. We find political logics, regulators’ capacities and economic contexts as key drivers. Finally, we conclude that the idea of enforcement as a rational application of legal norms is unrealistic. In order to increase compliance, regulators should make more of an effort to understand the underlying rationale for compliance and violations; they need to secure political support and a credible strategy for escalating sanctions in case of non-compliance.
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Notes
- 1.
Among the enforcement instruments skipped is the personal liability of the local treasurer in England, forced mergers in Finland and the insolvency procedure in Italy (the only country were insolvencies occur regularly).
- 2.
This section builds on empirical material presented in Person and Geissler (2020).
- 3.
This principle of local public finance regulation builds on the constitutional guarantee of local self-government in Germany.
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Geissler, R., Wegrich, K. (2021). Fiscal Rules at the Local Level: The Challenge of Enforcement. In: Geissler, R., Hammerschmid, G., Raffer, C. (eds) Local Public Finance. Springer, Cham. https://doi.org/10.1007/978-3-030-67466-3_3
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