This paper discusses the theory and practice of counter-cyclical fiscal policy to draw conclusions relevant for the fiscal architecture of the European Union. It starts by reviewing major lines of criticism on counter-cyclical fiscal policy, such as the existence of various lags, versions of...

A non-linear macrodynamic model is presented here to study possible stabilization policies in a financially unstable economy. Three policy rules will be considered, namely the interest rate rule (also called Taylor rule), the money supply rule and the fiscal policy rule. It will be shown that...

We propose an integrated treatment of the problems of optimal monetary and fiscal policy, for an economy in which prices are sticky (so that the supply-side effects of tax changes are more complex than in standard fiscal analyses) and the only available sources of government revenue are...

In this paper, we examine the nonlinear relationship between the number of fiscal rules in place and compliance with the European Union (EU) numerical fiscal targets included in the Stability and Growth Pact. Using a sample composed of 27 EU Member States for a period spanning 2000 to 2021, we...

This paper analyzes the fiscal policy implications set in the Mundell‑Fleming (M‑F) model and its effectiveness in emerging economies. It also widens the scope of the policy mix with alternative exchange rates. The empirical evidence about the economies of Chile (1991-2003) and Colombia...