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The failure of ECB monetary policy from a Mises-Hayek perspective

Schnabl, Gunther - 2017

The paper analyses the common European monetary policy based on a Mises-Hayek overinvestment framework, which is combined with the theory of optimum currency areas. It shows how since the turn of the millennium a too expansionary monetary policy contributed to unsustainable overinvestment booms...

Persistent link: https://www.econbiz.de/10011619626

Fiscal transfers in a monetary union with exit option

Hefeker, Carsten; Neugart, Michael - 2015

It is widely debated whether a monetary union has to be accompanied by a fiscal transfer scheme to accommodate asymmetric shocks. We build a model of a monetary union with a central bank and two heterogeneous countries that are linked by a fiscal transfer scheme with repercussions on monetary...

Persistent link: https://www.econbiz.de/10010492336

Inflation targeting by debtor central banks in emerging market economies

Löffler, Axel; Schnabl, Gunther; Schobert, Franziska - 2010

to accumulate massive foreign reserves. If left unsterilized, the liquidity expansion can threaten domestic macroeconomic … stability. To contain domestic inflation these central banks absorb rather then provide liquidity in their regular monetary … surplus liquidity is less efficient, because absorbing liquidity raises the costs of monetary policy operations. By …

Persistent link: https://www.econbiz.de/10003994520

Limits of monetary policy autonomy by East Asian debtor central banks

Löffler, Axel; Schnabl, Gunther; Schobert, Franziska - 2012

thereby increase surplus liquidity. East Asian central banks with more flexible exchange rate regimes also face surplus … liquidity that mainly emanates from past accumulation of foreign reserves. We show based on an augmented Barro …-Gordon-type central bank loss function that in both cases surplus liquidity limits monetary policy autonomy. In case of fixed exchange …

Persistent link: https://www.econbiz.de/10009500749

Fiscal and monetary policy interactions : empirical evidence and optimal policy using a structural New Keynesian model

Muscatelli, V. Anton; Tirelli, Patrizio; Trecroci, Carmine - 2003

This paper examines the interaction of monetary and fiscal policies using an estimated New Keynesian dynamic general equilibrium model for the US. In contrast to earlier work using VAR models, we show that the strategic complementarity or substitutability of fiscal and monetary policy depends...

Persistent link: https://www.econbiz.de/10011511042

Uncertainty and fiscal policy in an asymmetric monetary union

Hefeker, Carsten (contributor); Zimmer, Blandine (contributor) - 2008

The paper examines the monetary-fiscal interactions in a monetary union model with uncertainty due to imperfect central bank transparency. We first show that monetary uncertainty disciplines fiscal policymakers and thereby reduces taxes, average inflation and output distortions. However, as more...

Persistent link: https://www.econbiz.de/10003749682

The role of fiscal policy in a monetary union : are national automatic stabilizers effective?

Colciago, Andrea; Muscatelli, V. Anton; Ropele, Tiziano; … - 2006

We assess the role of national fiscal policies, as automatic stabilizers, within a monetary union. We use a two-country New Keynesian DGE model which incorporates non-Ricardian consumers (as in Galì et al. 2004) and a home bias in the composition of national consumption bundles. We find that...

Persistent link: https://www.econbiz.de/10003301196

A simple and flexible alternative to the stability and growth pact deficit ceilings : is it at hand?

Muscatelli, V. Anton; Natale, Piergiovanna; Tirelli, … - 2003

There have been widespread criticisms of EMU fiscal institutions. We consider a simple alternative to the deficit ceilings envisaged in the Stability and Growth Pact. We advocate the adoption of deficit targets. National governments should retain discretion in setting deviations from targets,...

Persistent link: https://www.econbiz.de/10011509363

Can fiscal policy help macroeconomic stabilisation? : evidence from a New Keynesian model with liquidity constraints

Muscatelli, V. Anton; Tirelli, Patrizio; Trecroci, Carmine - 2004

This paper derives a New Keynesian dynamic general equilibrium model with liquidity- constrained consumers and sticky …

Persistent link: https://www.econbiz.de/10011402458

Political uncertainty, public expenditure and growth

Darby, Julia; Li, Chol-won; Muscatelli, V. Anton - 2000

We focus on the link between political instability due to uncertain electoral outcomes and economic growth, through the impact on a government's decisions on how to allocate government expenditure between public consumption and investment. Using an endogenous growth model with partisan electoral...

Persistent link: https://www.econbiz.de/10009781587