This paper formulates an optimizing model of a small open economywith a representative (immortal) household, a firm and agovernment. The asset menu consists of domestic currency,non-traded bonds and traded bonds. There is a risk-premium ontraded bonds, which leads to deviations from perfect...

Stability-oriented European institutions correspond to the general prescriptions of the ‘new macroeconomics consensus’. This contribution provides an assessment of the pros and cons of these institutions in terms of macro stabilisation and exchange-rate swings drawing on different scenarios....

This article presents a survey of the Fiscal Theory of the Price Level. According to it, there are two stable regimes of economic policies: one, traditional, where the monetary authorities control inflation and where the fiscal authorities must be concerned with their intertemporal balance. The...

We apply meta regression analysis to a unique data set of 104 studies on multiplier effects with 1069 reported multipliers in order to derive stylized facts and to quantify the differing effectiveness of the composition of fiscal impulses, adjusted for the interference of study-design...

We analyse the effects of a government spending expansion in a dynamic stochastic general equilibrium (DSGE) model with Mortensen-Pissarides labour market frictions, deep habits and a constant-elasticity-of-substitution (CES) production function. The combination of deep habits and CES technology...

This paper examines the growing gap between the theoretical and empirical growth literature and policy needs of the developing economies. Growth literature has focused mainly on long term growth outcomes, but policy makers of the developing economies need rapid improvements in the short to...

This paper studies whether a reallocation of the components of public spending and revenues can enhance economic growth using data on 14 EU countries during 1990-2006. The results provide support for endogenous growth models. Specifically, the findings are: a) public expenditures on...

While the use of public resources is critical to cushion the impact of the financial crisis on the euro-area economy, it is key that the entailed fiscal costs not be seen by markets as undermining fiscal sustainability. From this perspective, to what extent do movements in euro area sovereign...

Economic reality has shown that current enforcement techniques will produce the desired finalities, avoiding distortion under psychological decision of all members of society and reduce the current costs of tax administration. Therefore, taxation is the product of social factors, which...