Désajustements de change, fédéralisme budgétaire et redistribution: comment s’ajuster en union monétaire

Exchange Rate Misalignments, Fiscal Federalism and Redistribution: How to Adjust in a Monetary Union

Vincent Duwicquet (), Jacques Mazier and Jamel Saadaoui

MPRA Paper from University Library of Munich, Germany

Abstract: The euro zone crisis illustrates the insufficiency of adjustment mechanisms in a monetary union characterized by a large heterogeneity. Firstly, the paper gives an evaluation of exchange rate misalignments inside the euro zone, using a FEER approach (Jeong, Mazier and Saadaoui, 2010). Using panel econometric techniques over the period 1994-2010, we confirm that the exchange rate misalignments in the euro zone have diverged, reflecting unsustainable evolutions. Secondly, we use a “stock-flow consistent” model of 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 and social transfers financed by federal taxes and euro-bonds issuing. The stabilizing role of such a federal budget is confirmed facing asymmetric shock or the negative impact of exchange rate misalignments inside the monetary union. Similarly, the stabilizing role of euro-bonds used to finance European investment projects is illustrated.

Keywords: Désajustements de taux de change; ajustements; union monétaire; crise de la zone euro (search for similar items in EconPapers)
JEL-codes: E12 F32 (search for similar items in EconPapers)
Date: 2012-11-26
New Economics Papers: this item is included in nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/42858/1/MPRA_paper_42858.pdf original version (application/pdf)

Related works:
Journal Article: 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? (2013)
Working Paper: Désajustements de change, fédéralisme budgétaire et redistribution: comment s'ajuster en union monétaire (2012)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:42858

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().