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We simulate a version of the EAGLE, a New Keynesian multi-country model of the world economy, to assess the macroeconomic effects of US tariffs imposed on one country member of the euro area (EA), and the rest of the world (RW). The model is augmented with an endogenous effective lower bound...
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This paper studies the effects of protectionism as a business cycle instrument. In normal times, protectionism reduces … international trade, distorts production and reduces output. However, in a liquidity trap protectionism lowers the real interest …
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