Third country effects of fiscal devaluations

Philipp Engler, Sandra Pasch and Juha Tervala

Economics Letters, 2018, vol. 163, issue C, 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.

Keywords: Fiscal devaluation; Fiscal policy; Monetary union; Current account; 3-country model (search for similar items in EconPapers)
JEL-codes: E32 E62 F32 F41 (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:163:y:2018:i:c:p:13-16

DOI: 10.1016/j.econlet.2017.11.011

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