The role of the public sector in Spain: Structural characteristics and policy adjustment on the road to the EEC Internal Market

Abstract

This paper discusses the main features of the Spanish fiscal and expenditure policies over the past fifteen years and briefly addresses both the adjustment efforts over the 1975-1985 period and the responses of public policy to the 'EEC cum 1992' shock. The impressionistic analysis which follows can be succintly summarized by three basic questions. Which are the main structural characteristics of the Spanish public sector on the eve of the EEC membership? How did public policy respond to the impact of the EEC accession? What policies could be implemented as to reduce the costs associated to the fundamental economic changes envisaged for 1992? The first question is addressed in Section I. Section II will address the issue of public policy responses to the permanent shock of 1986 as well as to the challenges posed by the 1992 European Internal Market.