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Structural distortions and decentralized fiscal policies in EMU
Beetsma, Roel; Bovenberg, Ary Lans - 2001
The combination of discretionary monetary policy, labor-market distortions and nominal wage rigidity yields an inflation bias as monetary policy tries to exploit nominal wage contracts to address labour-market distortions Although an inflation target eliminates this inflation bias, it creates a...
Persistent link: https://www.econbiz.de/10011398780
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Can poductive government spending be the engine of long-run growth when labor supply is engogenous?
Park, Hyun; Philippopulos, Apostolēs - 2002
We reexamine the properties of optimal fiscal policy and their implications for implementable capital accumulation. The setup is a standard endogenous growth model with public production services, augmented by elastic labor supply. We show that, when a benevolent government chooses a distorting...
Persistent link: https://www.econbiz.de/10011409385
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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
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Subjective models of the macroeconomy : evidence from experts and a representative sample
Andre, Peter; Pizzinelli, Carlo; Roth, Christopher; … - 2019
the inflation rate respond to four different hypothetical exogenous shocks: a monetary policy shock, a government spending … shock, an income tax shock, and an oil price shock. While expert predictions are quantitatively close to benchmarks from … predictions of changes in inflation are at odds with those of experts both for the tax shock and the interest rate shock. We show …
Persistent link: https://www.econbiz.de/10012104048
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The worst of both worlds : fiscal policy and fixed exchange rates
Born, Benjamin; D'Ascanio, Francesco; Müller, Gernot J.; … - 2019
Under fixed exchange rates, fiscal policy is an effective tool. According to classical views because it impacts the real exchange rate, according to Keynesian views because it impacts output. Both views have merit because the effects of government spending are asymmetric. A spending cut lowers...
Persistent link: https://www.econbiz.de/10012118599
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Macroeconomic stabilization policies in the EMU : spillovers, asymmetries, and institutions
Di Bartolomeo, Giovanni; Engwerda, Jacob Christiaan; … - 2005
depend on the particular characteristics of the shocks and the economic structure. In the case of a common shock, fiscal …
Persistent link: https://www.econbiz.de/10002572274
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Shocks, frictions, and inequality in US business cycles
Bayer, Christian; Born, Benjamin; Luetticke, Ralph - 2020
How much does inequality matter for the business cycle and vice versa? Using a Bayesian likelihood approach, we estimate a heterogeneous-agent New-Keynesian (HANK) model with incomplete markets and portfolio choice between liquid and illiquid assets. The model enlarges the set of shocks and...
Persistent link: https://www.econbiz.de/10012162730
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The failure of ECB monetary policy from a Mises-Hayek perspective
Schnabl, Gunther - 2017
combined with the theory of optimum currency areas. It shows how since the turn of the millennium a too expansionary monetary …
Persistent link: https://www.econbiz.de/10011619626
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Monetary policy in Turkey after Central Bank independence
Gürkaynak, Refet S.; Kantur, Zeynep; Taş, M. Anil; … - 2015
We present an accessible narrative of the Turkish economy since its great 2001 crisis. We broadly survey economic developments and pay particular attention to monetary policy. The data suggests that the Central Bank of Turkey was a strong inflation targeter early in this period but began to pay...
Persistent link: https://www.econbiz.de/10011375680
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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