We briefly review the theoretical and empirical consequences of discretionary fiscal policy changes, after which we provide our own estimates for the EU countries. A fiscal expansion raises output and consumption and reduces the trade balance. Moreover, the stimulating effect of higher...

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...

Reaching for a new deal: ambitious governance, economic meltdown, and polarized politics / Theda Skocpol, Lawrence R. Jacobs -- Hard-fought legacy: Obama, congressional democrats, and the struggle for comprehensive health care reform / Lawrence R. Jacobs, Theda Skocpol -- Eliminating the market...

The combination of discretionary montetary policy, labor-market distortions and nominal wage rigidity yields an inflation bias as monetary policy tries to exploit nominal wage contracts to address labor-market distortions. Although an inflation target eliminates this inflation bias, it creates a...