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PRODID:https://www.diw.de/de/diw_01.c.806339.de/veranstaltungen.html
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UID:diw_01.c.1000174.en
LOCATION:Anna-J.-Schwartz-Raum,DIW Berlin,5.2.010,Anton-Wilhelm-Amo-Straße 58,10117 Berlin
SUMMARY:Monetary and Fiscal Interactions
DESCRIPTION:04.05.: 10
a.m.-1 p.m. and 2-5 p.m.

05.05.: 10
a.m.-1 p.m. // Public debt has reached historically high levels in many advanced economies and continues to grow at an unprecedented pace. This development has brought questions of fiscal sustainability, macroeconomic stability, and the appropriate conduct of monetary and fiscal policy to the forefront of policy debates worldwide.  This five-lecture course investigates the mechanisms and conditions under which large public debt gives rise to macroeconomic instability, using dynamic stochastic general equilibrium (DSGE) models as a unified analytical framework. Within this framework, we examine the constraints, trade-offs, and credibility issues faced by monetary authorities when public debt is both large and persistent. We analyze alternative regimes of monetary–fiscal interaction and assess how different forms of policy coordination can stabilize public debt dynamics, with particular emphasis on their implications for inflation and output growth.  The course devotes special attention to the challenges of fiscal policy coordination in a monetary union, where national fiscal authorities operate under a common monetary policy, as in the European Union. Building on these theoretical insights, we then confront the models with empirical evidence, highlighting the role of fiscal–monetary interactions in shaping inflation dynamics over the postwar period. Finally, we apply the framework to contemporary policy challenges, discussing how monetary and fiscal authorities in the United States and the euro area can respond to the legacy of the large public debt accumulated in the aftermath of the COVID-19 pandemic.     
DTSTART;VALUE=DATE:20260503T220000Z
DTEND;VALUE=DATE:20260505T220000Z
DTSTAMP:20260216T230000Z
URL:https://www.diw.de/en/diw_01.c.1000174.en/events/monetary_and_fiscal_interactions.html
ORGANIZER;CN=Ina Müller:mailto:imueller@diw.de
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