Berriel, Rafael; Gonzalez-Aguado, Eugenia; Kehoe, Patrick J. - National Bureau of Economic Research - 2023
a real-economy model with no fiscal externalities, in which local fiscal authorities have an informational advantage … a centralized regime is optimal for large ones. We then consider a monetary-economy model, in which governments finance … countries in the monetary union increases. Hence, as in the real-economy model, a decentralized fiscal regime is optimal for …