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A new comparative approach to macroeconomic modeling and policy analysis

Wieland, Volker; Cwik, Tobias; Müller, Gernot J.; … - 2012

In the aftermath of the global financial crisis, the state of macroeconomicmodeling and the use of macroeconomic models in policy analysis has come under heavy criticism. Macroeconomists in academia and policy institutions have been blamed for relying too much on a particular class of...

Persistent link: https://www.econbiz.de/10010391307

Fiscal devaluation in a monetary union

Engler, Philipp; Ganelli, Giovanni; Tervala, Juha; … - 2014 - This version: 12.11.2013

Between 1999 and the onset of the economic crisis in 2008 real ex-change rates in Greece, Ireland, Italy, Portugal and Spain appreciated relative to the rest of the euro area. This divergence in competitiveness was reflected in the emergence of current account imbalances. Given that exchange...

Persistent link: https://www.econbiz.de/10010235320

The eurozone : what is to be done?

Minford, Patrick; Ou, Zhirong; Wickens, Michael R.; … - 2021 - This draft: May2021

We construct a macro DSGE model of the eurozone and its two main regions, the North and the South, with the aim of matching the macro facts of these economies by indirect inference and using the resulting empirically-based model to assess possible new policy regimes. The model we have found to...

Persistent link: https://www.econbiz.de/10012591814

Fiscal devaluation in a Monetary Union

Engler, Philipp; Ganelli, Giovanni; Tervala, Juha; … - 2013

Between 1999 and the onset of the economic crisis in 2008 real exchange rates in Greece, Ireland, Italy, Portugal and Spain appreciated relative to the rest of the euro area. This divergence in competitiveness was reflected in the emergence of current account imbalances. Given that exchange rate...

Persistent link: https://www.econbiz.de/10010221275

Fiscal policy, banks and the financial crisis

Kollmann, Robert; Ratto, Marco; Röger, Werner; Veld, … - 2012

This paper studies the effectiveness of Euro Area (EA) fiscal policy, during the recent financial crisis, using an estimated New Keynesian model with a bank. A key dimension of policy in the crisis was massive government support for banks - that dimension has so far received little attention in...

Persistent link: https://www.econbiz.de/10011590516

Sovereign default and imperfect tax enforcement

Pappadà, Francesco; Zylberberg, Yanos - 2019

We show that, in many countries, tax compliance is volatile and markedly responds to fiscal policy. To explore the consequence of this novel stylized fact, we build a model of sovereign debt with limited commitment and imperfect tax enforcement. Fiscal policy persistently affects the size of the...

Persistent link: https://www.econbiz.de/10012029059

Estimating regime dependent fiscal spillover effects in a monetary union

Kunzmann, Vanessa - 2023

policy varies between inflation targeting and restrained price level determination. I find that spillover multipliers are …

Persistent link: https://www.econbiz.de/10014335117

Imperfect financial markets and the cyclicality of social spending

Froemel, Maren; Paczos, Wojtek - 2024

This paper explores the link between default risk and fiscal procyclicality. We show that countries with higher sovereign risk have a more procyclical fiscal expenditure policy, which is driven mostly by transfers. We build a small open economy model with income inequality, social transfers, and...

Persistent link: https://www.econbiz.de/10014490852

Credibility and bias : the case for implementing both a debt anchor and a balanced budget rule

Castro-Valderrama, Marcela de; Moreno-Arias, Nicolás; … - 2023

Should a government have more than one fiscal rule constraining fiscal aggregates? If so, why? In this paper, we present a dynamic general equilibrium model of a small open economy featuring an incumbent government to assess how and why implementing a budget balance rule and a debt anchor rule...

Persistent link: https://www.econbiz.de/10014290466

The real exchange rate in the long run : Balassa-Samuelson effects reconsidered

Bordo, Michael D.; Choudhri, Ehsan U.; Fazio, Giorgio; … - 2014

Historical data for over hundred years and 14 countries is used to estimate the long-run effect of productivity on the … real exchange rate. We find large variations in the productivity effect across four distinct monetary regimes in the sample … argue that changes in trade costs over time may affect the impact of productivity on the real exchange rate over time. We …

Persistent link: https://www.econbiz.de/10010374513