Hefeker, Carsten; Zimmer, Blandine - CESifo - 2008
The paper examines the monetary-fiscal interactions in a monetary union model with uncertainty due to imperfect central …, average inflation and output distortions. However, as more members enter the monetary union, the fiscal disciplining effect of … uncertainty is mitigated. As a consequence, monetary union enlargement may lead to a more aggressive fiscal stance in some member …