This paper investigates the impact of population ageing on the economic and fiscal performance of Finland, a small open economy, which has undergone a rapid and significant demographic shift since 2010. By employing the Synthetic Control Method (SCM) to create a counterfactual scenario without...

This paper investigates the impact of population ageing on the economic and fiscal performance of Finland, a small open economy, which has undergone a rapid and significant demographic shift since 2010. By employing the Synthetic Control Method (SCM) to create a counterfactual scenario without...

This paper analyzes the sustainability of fiscal debt contingent on fiscal policy operating in two fiscal regimes. The first regime is characterized by active policy (not reacting to debt) and the other by passive fiscal policy (reacting to debt). The average duration for which either regime can...

Financial institutions, especially in Europe, hold a disproportionate amount of domestic sovereign debt. We examine the extent to which this home bias leads to capital misallocation in a real business cycle model with imperfect information and fiscal stress. We assume banks can hold sovereign...

This paper deals with the debt-growth relationship using several time-series tools. The idea is to find out whether the inverse relationship between these variable can be detected without imposing any functional forms for the estimating relationship and whether the relationship does indeed...

Recent economic developments in Argentina give rise to several interesting observations about the workings and effects of economic policies. Of particular interest, of course, are the dramatic changes in inflation as a consequence of the economic policies of the newly elected President Javier...

This paper deals with fiscal policy coordination within the European Monetary Union. In the first place, it investigates the potential problems which are caused by cross-country differences in key fiscal parameters and the asymmetric nature of these parameters. In the second section, the pros...

This paper deals with problems of fiscal consolidation and policy coordination within the European Monetary Union. In the first place, it investigates the potential problems which are caused by cross-country differences in key fiscal parameters and the asymmetric nature of these parameters. In...

Since the start of EMU national fiscal policy in the Eurozone can be conducted almost without paying any attention to consequences for the exchange rate. This might lower fiscal discipline. In order to shed light on the empirical relevance of this consideration, the impact of the exchange rate...

We study the impact of the interaction between fiscal and monetary policy on the low-frequency relationship between the fiscal stance and inflation using crosscountry data from 1965 to 1999. In a first step, we contrast the monetary-fiscal narrative for Germany, the U.S. and Italy with evidence...