The paper uses a small open economy general equilibrium model to compare fiscal and nominal exchange rate devaluation … fiscal devaluation mimics nominal exchange rate adjustment and mitigates the output loss associated with demand rebalancing … tax shift from labour to consumption as standard example of fiscal devaluation remains moderate, however …

on the trade balance are necessary conditions for stability. It is shown that the effects of a devaluation on aggregate … the economy. The effectiveness of a currency devaluation as a stabilization policy remains unclear, its adoption is not …

, government expenditures, tax rates, fiscal deficits, market uncertainty measures to present a holistic picture of the economy and … of the trends/stances of both monetary and fiscal policy using these large number of variables. It discusses the debate …