Third Country Effects of Fiscal Devaluations

Aufsätze referiert extern - Web of Science

Philipp Engler, Sandra Pasch, Juha Tervala

In: Economics Letters 163 (2018), S. 13-16

Abstract

We analyze fiscal devaluation in a three-country model. The introduction of the third country, outside a monetary union, increases the expansionary effect of fiscal devaluation and the second country of the monetary union experiences a boom instead of a recession.

Sandra Pasch

Scholarship Recipient in the Macroeconomics Department

Topics: Monetary policy



JEL-Classification: E32;E62;F32;F41
Keywords: Fiscal devaluation, Fiscal policy, Monetary union, Current account, 3-country model
DOI:
https://doi.org/10.1016/j.econlet.2017.11.011