
Contents
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Introduction Introduction
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French Officials/Fund Relations and Article IV Consultations French Officials/Fund Relations and Article IV Consultations
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French Fiscal Policy and the Crisis French Fiscal Policy and the Crisis
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Turning Off the Taps Turning Off the Taps
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Weak Growth and Fiscal Consolidation Weak Growth and Fiscal Consolidation
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The Fund’s Shaping of the European Fiscal Policy Debate 2012–13 The Fund’s Shaping of the European Fiscal Policy Debate 2012–13
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Franco-German Relations, the IMF, and Eurozone Crisis Narratives Franco-German Relations, the IMF, and Eurozone Crisis Narratives
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The IMF, Breaking the ‘Doom Loop’, and the Politics of European Banking Union The IMF, Breaking the ‘Doom Loop’, and the Politics of European Banking Union
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Conclusion Conclusion
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7 The IMF and French Fiscal Rectitude amidst the Eurozone Crisis
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Published:February 2018
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Abstract
This chapter provides the first account of IMF commentary on and interventions in the French economic policy debate following the crash to analyse how the Fund has sought to inflect French policy settings and approaches. It also situates French macroeconomic policy developments in the context of the European policy debate to demonstrate how the IMF has worked to influence reforms to the Eurozone’s architecture. Drawing on interviews with French policy elites and advisors, as well as members of Fund missions to France, it demonstrates how the French government, alongside the IMF, sought a less pro-cyclical approach and to open up ‘fiscal space’ for growth-oriented policies within European economic and monetary arrangements. However, key centres of power, notably the German government, the European Commission, and the European Central Bank prioritized ‘moral hazard’ and the ‘crisis of debt’ narratives, whose policy corollaries were ever-tighter fiscal discipline and ramped-up austerity.
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