Désajustements de change, fédéralisme budgétaire et redistribution. Comment s'ajuster en union monétaire

Vincent Duwicquet (), Jacques Mazier and Jamel Saadaoui

Revue de l'OFCE, 2013, vol. N° 127, issue 1, 57-96

Abstract: The euro zone crisis illustrates the insufficiency of adjustment mechanisms in a monetaryunion characterized by a large heterogeneity. Firstly, the paper gives an evaluationof exchange rate misalignments inside the euro zone, using a FEER approach(Jeong et ali., 2010). Usingpanel econometric techniques over the period 1994-2010, we confirm that the exchange ratemisalignments in the euro zone have diverged, reflecting unsustainable evolutions. Secondly, we use a ?stock-flow consistent? modelof a monetary union with two countries along the lines of Godley and Lavoie (2007) and Duwicquet and Mazier (2010). A federal budget is introduced with federal expenditures andsocial transfers financed by federal taxes and euro-bonds issuing. The stabilizing role of such a federal budget is confirmed facing asymmetric shock or thenegative impact of exchange rate misalignments inside the monetary union. Similarly, the stabilizingrole of euro-bonds used to finance European investment projects is illustrated. JEL Classification: F31, F32, F41, F37, E12.

Keywords: exchange rate misalignments; adjustments; monetary union; euro zone crisis (search for similar items in EconPapers)
JEL-codes: E12 F31 F32 F37 F41 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Related works:
Working Paper: Désajustements de change, fédéralisme budgétaire et redistribution: comment s’ajuster en union monétaire? (2013)
Working Paper: Désajustements de change, fédéralisme budgétaire et redistribution: comment s'ajuster en union monétaire (2012)
Working Paper: Désajustements de change, fédéralisme budgétaire et redistribution: comment s’ajuster en union monétaire (2012)
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