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Government spending shocks, sovereign risk and the exchange rate regime

Bonam, Dennis; Lukkezen, Jasper - 2013

Conventional wisdom teaches that the output response upon a fiscal expansion is higher under fixed than floating exchange rates for a small open economy. We analyse the effects of fiscal expansions using a New Keynesian model and find that this result reverses in times of sovereign default risk....

Persistent link: https://www.econbiz.de/10010227296

Fiscal and monetary policy coordination, macroeconomic stability, and sovereign risk

Bonam, Dennis; Lukkezen, Jasper - 2014

In standard macroeconomic models, debt sustainability and price level determinacy are achieved when fiscal policy avoids explosive debt and monetary policy controls inflation, irrespective of the relative strengths of each policy stance. We examine how these policy requirements for equilibrium...

Persistent link: https://www.econbiz.de/10010227696

Private and public risk sharing in the Euro area

Cimadomo, Jacopo; Furtuna, Oana; Giuliodori, Massimo M. - 2017 - This version: 11 July 2017

This paper investigates the contribution of private and public channels for consumption risk sharing in the EMU over … estimating how risk sharing has evolved since the start of the EMU, and in particular during the recent crisis. Our results … suggest that, whereas in the early years of the EMU only about 40% of output shocks were smoothed, in the aftermath of the …

Persistent link: https://www.econbiz.de/10011688776

Electoral cycles : do they really fit the data?

Galeotti, A.; Salford, G. - 2001

This paper provides a theoretical model of pre-electoral budget cycle and tests its empirical implications. Whenelections approach, incumbent policy-makers have an incentive to signal their competency by acting on economicvariables. Rational voters incorporate the knowledge of such mechanisms in...

Persistent link: https://www.econbiz.de/10011317452

Electoral cycles : do they really fit the data?

Galeotti, A.; Salford, G. - 2001

Persistent link: https://www.econbiz.de/10001601721