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Fiscal rules and sustainability of public finances in an endogenous growth model

Annicchiarico, Barbara; Giammarioli, Nicola - 2004

This paper presents a two period overlapping generations model with endogenous growth in the presence of a public sector with objectives of convergence for public debt and primary balance to GDP ratios. In order to ensure the existence of converging paths towards the target values of fiscal...

Persistent link: https://www.econbiz.de/10009639435

Longer-term effects of monetary growth on real and nominal variables, major industrial countries, 1880-2001

Haug, Alfred A.; Dewald, William G. - 2004

We study how fluctuations in money growth correlate with fluctuations in real and nominal output growth and inflation … contemporaneously affects nominal output growth and inflation in the longer run. This result holds despite differences in policies and …

Persistent link: https://www.econbiz.de/10009639436

Explicit inflation objectives and macroeconomic outcomes

Levin, Andrew T.; Natalucci, Fabio M.; Piger, Jeremy M. - 2004

We find evidence that adopting an explicit inflation objective plays a role in anchoring long-run inflation … expectations and in reducing the intrinsic persistence of inflation. For the period 1994-2003, private-sector long-run inflation … forecasts exhibit significant correlation with lagged inflation for a number of industrial economies, including the United …

Persistent link: https://www.econbiz.de/10009639437

Price rigidity

Baudry, Laurent; Le Bihan, Hervé; Sevestre, Patrick; … - 2004

Based upon a large fraction of the price records used for computing the French CPI, we document consumer price rigidity in France. We first provide a methodological discussion of issues involved in estimating average price duration with micro-data. The average duration of prices in the sectors...

Persistent link: https://www.econbiz.de/10009639438

Euro area sovereign yield dynamics

Menkveld, Albert J.; Cheung, Yiu C.; Jong, Frank/de - 2004

We study sovereign yield dynamics and order flow in the largest euro-area treasury markets. We exploit unique transaction data to explain daily yield changes in the ten-year government bonds of Italy, France, Belgium, and Germany. We use a state space model to decompose these changes into (i) a...

Persistent link: https://www.econbiz.de/10009639439

Horizontal and vertical integration and securities trading and settlement

Tapking, Jens; Yang, Jing - 2004

This paper addresses a very European issue, the consolidation of securities trading and settlement infrastructures. In a two-country model, we analyze welfare implications of different types of consolidation. We find that horizontal integration of settlement systems is better than vertical...

Persistent link: https://www.econbiz.de/10009639440

Intergenerational altruism and neoclassical growth models

Michel, Philippe; Thibault, Emmanuel; Vidal, Jean-Pierre - 2004

This paper surveys intergenerational altruism in neoclassical growth models. It first examines Barro's approach to intergenerational altruism, whereby successive generations are linked by recursive altruistic preferences. Individuals have an altruistic concern only for their children, who in...

Persistent link: https://www.econbiz.de/10009639441

Euro area inflation differentials

Angeloni, Ignazio; Ehrmann, Michael - 2004

We build a stylised 12-country model of the euro area and use it to analyse why differences in national inflation and … growth rates arise within the European monetary union. We find that inflation persistence is a key potential explanatory … mechanism across countries, count less. We also look at how a monetary policy geared to area-wide average inflation affects …

Persistent link: https://www.econbiz.de/10009639448

Forecasting with a Bayesian DSGE model

Smets, Frank; Wouters, Raf - 2004

inflation and output play an important role. This paper illustrates how modern sticky-price dynamic stochastic general … distribution of the forecast, as well as various inflation risk measures that have been proposed in the literature. Finally, the …

Persistent link: https://www.econbiz.de/10009639449

Financial markets' behavior around episodes of large changes in the fiscal stance

Ardagna, Silvia - 2004

Using a panel of OECD countries from 1960 to 2002, this paper shows that financial markets value fiscal discipline. Interest rates, particularly those of long-term government bonds, decrease when countries' fiscal position improves and increase around periods of budget deteriorations. Stock...

Persistent link: https://www.econbiz.de/10009639450