Many macroeconomists and politicans claim that fi scal austerity – getting the budget defi - cit down immediately – would be good for employment and growth. We think that fi scal stimulus is expansionary, and fi scal contraction is contractionary. There is a large and growing body of...

Over the course of the recession during the last six years, central bank officials in Croatia have on numerous occasions stated there is a strong need for structural reforms in Croatia and that there is no need for monetary policy reforms. This short paper investigates why the CNB is only...