Die gegenwärtige Finanzkrise und die zu ihrer Eindämmung verabschiedeten staatlichen Hilfsprogramme treiben die Staatsschulden in die Höhe. Wann und mit welchen Maßnahmen sollte mit der Haushaltskonsolidierung begonnen werden? Nach Ansicht von Hans Fehr, Universität Würzburg, kann die...

Following the Great Recession, many European countries implemented fiscal consolidation policies aimed at reducing government debt. Using three independent data sources and three different empirical approaches, we document a strong positive relationship between higher income inequality and...

We present a two-country New Open Economy Macroeconomics model of a currency union featuring an overlapping generations structure of the Blanchard (1985)-Yaari (1965) type as well as monopolistic frictions and staggered adjustment in the goods and labor market. We allow for public investment and...

We present an analytically tractable two-country New Open Economy Macroeconomics model of a currency union featuring an overlapping gen- erations structure of the Blanchard (1985)-Yaari (1965) type. It enables us to study the transmission and spillover effects of a wider range of fiscal shocks...

Die gegenwärtige Finanzkrise und die zu ihrer Eindämmung verabschiedeten staatlichen Hilfsprogramme treiben die Staatsschulden in die Höhe. Wann und mit welchen Maßnahmen sollte mit der Haushaltskonsolidierung begonnen werden? Nach Ansicht von Hans Fehr, Universität Würzburg, kann die...

This paper builds a two-country Heterogenous Agents New Keynesian (HANK) model for the Euro Area (EA). The two countries differ in the degree of public indebtedness, i.e., the Periphery has a relatively higher public debt-output ratio vis-à-vis the Core. The model captures some key features of...

This paper studies the political budget cycles of provincial governments in China and explores the channels that drive such cycles. It finds that in addition to good economic performance, being clean (or staying away from corruption) is an important factor in provincial leaders' chances of...

This paper studies the optimal design of fiscal policy when financial markets are incomplete at the aggregate and microeconomic level. The government trades a non-state contingent bond (liability) and cannot insure against the uncertainty in future tax revenues, while households are unable to...

Using iterative experiments to uncover causal links between critical policy details and outcomes helps to optimize policy design. This paper studies a large-scale staged fiscal stimulus program conducted during the COVID-19 pandemic, in which a provincial government in China disbursed digital...

In this paper, we present a disaggregated framework for the analysis of past and projected structural developments in the most relevant revenue and expenditure categories and the fiscal balance. The framework, in particular, distinguishes between the effects of discretionary fiscal policy and of...