Global models for a global pandemic: The impact of COVID-19 on small euro area economies

Pablo Garcia Sanchez, Pascal Jacquinot, Črt Lenarčič, Matija Lozej and Kostas(Konstantinos) Mavromatis

Journal of Macroeconomics, 2023, vol. 77, issue C

Abstract: We analyse the COVID-19 pandemic shock on small open economies (SOEs) in the euro area in a unified modelling framework: the Euro Area and the Global Economy model. We find strong negative international spillovers affecting each of the modelled SOEs, stemming not only from the rest of the euro area, but also from the United States and the rest of the world. A lower bound on nominal interest rates in the euro area amplifies these spillovers, especially within the euro area. Furthermore, we find some positive spillovers from the fiscal measures implemented in the Euro area to combat the pandemic, including the new Next Generation EU instrument.

Keywords: DSGE modelling; International spillovers; Monetary union; Euro area; COVID-19 (search for similar items in EconPapers)
JEL-codes: C53 E32 E52 F45 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Working Paper: Global models for a global pandemic: the impact of COVID-19 on small euro area economies (2023)
Working Paper: Global models for a global pandemic: the impact of COVID-19 on small euro area economies (2021)
Working Paper: Global models for a global pandemic: the impact of COVID-19 on small euro area economies (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jmacro:v:77:y:2023:i:c:s0164070423000514

DOI: 10.1016/j.jmacro.2023.103551

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