In the context of the current policy debate on the reform of European fiscal rules, there is wide consensus on the need to place more attention on debt-GDP ratios. Proposals have been made to alleviate fiscal pressure on Member States with relatively low public debts. The present paper gives support to this view. Economies with high public debt-GDP ratios are shown to experience larger price deviations after a fiscal expansion. These results are derived in a model, calibrated to euro area quarterly data, with capital accumulation, flexible prices and wealth effects in the presence of an independent monetary authority. (C) 2006 Society for Policy Modeling. Published by Elsevier Inc. All rights reserved.

Annicchiarico, B. (2007). Government deficits, wealth effects and the price level in an optimizing euro-model. JOURNAL OF POLICY MODELING, 29(1), 15-28 [10.1016/j.polmod.2006.04.003].

Government deficits, wealth effects and the price level in an optimizing euro-model

ANNICCHIARICO, BARBARA
2007

Abstract

In the context of the current policy debate on the reform of European fiscal rules, there is wide consensus on the need to place more attention on debt-GDP ratios. Proposals have been made to alleviate fiscal pressure on Member States with relatively low public debts. The present paper gives support to this view. Economies with high public debt-GDP ratios are shown to experience larger price deviations after a fiscal expansion. These results are derived in a model, calibrated to euro area quarterly data, with capital accumulation, flexible prices and wealth effects in the presence of an independent monetary authority. (C) 2006 Society for Policy Modeling. Published by Elsevier Inc. All rights reserved.
Pubblicato
Rilevanza internazionale
Articolo
Sì, ma tipo non specificato
Settore SECS-P/01 - Economia Politica
English
Con Impact Factor ISI
price stability; fiscal policy; government debt; Stability and growth pact (SGP)
http://www.sciencedirect.com/science/article/pii/S0161893806000433
http://www.ecb.int/pub/pdf/scpwps/ecbwp285.pdf
Annicchiarico, B. (2007). Government deficits, wealth effects and the price level in an optimizing euro-model. JOURNAL OF POLICY MODELING, 29(1), 15-28 [10.1016/j.polmod.2006.04.003].
Annicchiarico, B
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/2108/43112
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