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Monopolistic Competition and the Dependent Economy Model

Restout, Romain - 2011

account deficits and investment rises. Fourth, the strength of the relative price appreciation following sector productivity …

Persistent link: https://www.econbiz.de/10012714288

Fiscal and Currency Union with Default and Exit

Ferrari, Alessandro - 2020

Countries which share a common currency potentially have strong incentives to share macroeconomic risks through a system of transfers to compensate for the loss of national monetary policy. However, the option to leave the currency union and regain national monetary policy can place severe...

Persistent link: https://www.econbiz.de/10012825641

Fiscal Policy, Relocation of Firms, and the Exchange Rate

Johdo, Wataru - 2019

This study incorporates international firm mobility into a new open economy macroeconomic model to analyze the question of how allowing for the international relocation of firms affects the impact of government spending shock on consumption and exchange rate. The study shows that the government...

Persistent link: https://www.econbiz.de/10012858529

Fiscal Regimes and the Exchange Rate

Mirkov, Nikola; Alberola, Enrique; Cantú, Carlos; … - 2022

In this paper, we argue that the effect of monetary and fiscal policies on the exchange rate depends on the fiscal regime. A contractionary monetary (expansionary fiscal) shock can lead to a depreciation, rather than an appreciation, of the domestic currency if debt is not backed by future...

Persistent link: https://www.econbiz.de/10013308762

Budget-neutral fiscal rules targeting inflation differentials

Brede, Maren - 2016

In light of persistent in ation dispersion and rising debt levels in the EMU, this paper investigates the welfare implications of budget-neutral scal policies that counteract in ation di erentials. In a two-country DSGE model of a monetary union with traded and non-traded goods a national scal...

Persistent link: https://www.econbiz.de/10011437921

Regional Inflation in a Currency Union : Fiscal Policy vs. Fundamentals

Duarte, Margarida; Wolman, Alexander L. - 2021

that productivity shocks alone generate significant variation in inflation across the two countries. Government spending … that smaller countries experience higher variability of their inflation differential in response to shocks to productivity … productivity growth by letting the income tax rate respond negatively to inflation differentials …

Persistent link: https://www.econbiz.de/10013320200

The portfolio theory of inflation and policy (in)effectiveness revisited : corroborating evidence

Bossone, Biagio; Cuccia, Andrea - 2020

This study revisits and tests empirically the Portfolio Theory of Inflation (PTI), which analyzes how the effectiveness … (Bossone, The portfolio theory of inflation and policy (in)effectiveness, 2019). The PTI shows that when an economy is heavily … and policies aimed to stimulate output growth dissipate into domestic currency depreciation and higher inflation, with …

Persistent link: https://www.econbiz.de/10012140238