Journal articles on the topic 'Monetary policy. Fiscal policy. International macro'
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1
Truong, Bac Cong, Phan Quan Viet, Vu Thi Kim Hanh, Ho Thi Phuong Thao, Le Huong Duong, and Nguyen Ho Viet Anh. "Highlights in Managing Monetary Policy of Vietnam in Post-Crisis Period." Journal of Asian Development 6, no. 1 (February 9, 2020): 1. http://dx.doi.org/10.5296/jad.v6i1.16162.
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This paper focuses on assessing highlights in the managing monetary policy in post-crisis period from 2011 to present in Vietnam in order to identifies key messages which helped Vietnam overcome the financial crisis 2007-2008 and keep the growth rate stably at high level, to be one of highest growth rate in the world. The research used aggregated methods, descriptive statistics and analysis based on World Bank, International Monetary Fund, Central Bank of Vietnam data sources. The results shown that the monetary policy in Vietnam in this period had a flexible transition in its management objectives, coordinated in close with fiscal policy to achieve macro goals, besides changing the regulatory mechanism by volume to operating with interest rates and combined with other operating tools more diverse.
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Song, Xin, Xuejie Yang, Tao Li, and Yuntao Qiang. "How does the Policy Leverage the "Resident Leverage Ratio"?" Frontiers in Business, Economics and Management 4, no. 3 (August 16, 2022): 174–80. http://dx.doi.org/10.54097/fbem.v4i3.1290.
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Under the background that the international economy is in great recession and the new development pattern of domestic and international double circulation has gradually become a consensus macro-economy new normal, this paper investigates 31 provinces and cities' policies and residents' leverage ratio in recent ten years, and analyzes the direction and extent of industrial policy, fiscal policy and monetary policy on residents' leverage ratio by using stata, matlab and other software. The quantitative indicators of panel data are used to simulate dynamic and static models, respectively, to solve the problems of internal lag and endogenous variables, and to some extent reflect the impact of household leverage ratio on the domestic double-cycle situation. Finally, it is concluded that the completion of real estate development investment and the sales area of residential commercial housing are the main indicators that affect household leverage ratio. The added value of financial industry, land policy and per capita income of residents have a certain positive impact on the leverage ratio. Population age structure, interest rates and other factors have a weak impact on the leverage ratio. At the end of the article, the author puts forward some policy suggestions, such as correctly guiding the supply and demand relationship in the real estate market, improving the land fiscal policy, and reasonably regulating the monetary structure, which has certain reference significance for the research on the double-cycle development pattern at home and abroad.
3
Maevsky, V. I., and A. A. Rubinstein. "The Concept of Macro-Economic Policy Based on the Compromise between Inflation and Growth." Zhurnal Economicheskoj Teorii 18, no. 4 (2021): 485–96. http://dx.doi.org/10.31063/2073-6517/2021.18-4.1.
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The article describes a concept of a long-term macro-economic policy based on a compromise between economic growth and inflation that accompanies this growth. This concept differs from the existing theoretical approaches supported by monetary authorities in that it does not rely on the notion of Russia as a small open economy and it does not focus on price volatility as the number one problem in the long-term perspective. The theoretical framework usually used to address the relationship between economic growth and inflation is the Phillips curve and its modifications. In our study, this problem is connected to the phenomenon of non-neutrality of money in the long term. The analysis uses the simulation model of the shifting mode of reproduction (SMR model) and econometric methods. It is shown that a compromise between economic growth and inflation can be achieved if the long-term monetary policy results in the approximately equal rates of real GDP and inflation. Such monetary policy is possible to realize provided that some important macro-economic conditions are fulfilled, for example, the rouble undervaluation coefficient is reduced, the debt-to-gross-domestic- product ratio is increased, the ratio of international (foreign exchange) reserves to GDP is decreased, and the transition to a fiscal deficit policy is implemented. In other words, a systemic approach is required. This is not an easy way but it will ensure a growth in GDP rates and lower inflation.
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DANYLYSHYN, Bohdan. "ECONOMIC TRANSFORMATIONS DURING MARTIAL LAW: THE TACTICS OF EVOLUTIONISM AND MODERNIZATION." Economy of Ukraine 2022, no. 10 (October 24, 2022): 3–14. http://dx.doi.org/10.15407/economyukr.2022.10.003.
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In a war economy, ensuring the stability of price dynamics by the regulation of money supply faces a number of fundamental obstacles that significantly reduce the effectiveness of traditional monetary instruments. During the war, the market principles of economy’s functioning weaken, the monetary transmission mechanisms do not work adequately, the role of the state in ensuring the functioning of commodity-monetary relations increases. This calls for a revision of the macro-stabilizing role of monetary policy. Taking into account the above, approaches to the formulation of monetary policy directions during martial law are summarized, relevant recommendations for the current conditions of Ukraine are substantiated using theoretical sources, advisory and research papers of international organizations and national macroeconomic regulators, as well as statistical databases. Based on the generalization of theoretical principles and world experience, the design of the wartime monetary regime is substantiated, which involves the modification of such aspects as: the target-oriented monetary policy; the composition of interest rates for the central bank’s basic operations; harmonization of monetary policy decisions with fiscal policy priorities; establishment of a fixed exchange rate regime; enhanced control over the cross-border movement of capital. It is concluded that in a war economy, the main contribution of monetary policy to the achievement of macroeconomic stability should be made by the effective interaction with the government in ensuring the stable functioning of government borrowing market, controllability of capital movements, support for the creation of new jobs and generators of new added value for effective closure of new money supply.
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DANYLYSHYN, Bohdan. "ECONOMIC TRANSFORMATIONS DURING MARTIAL LAW: THE TACTICS OF EVOLUTIONISM AND MODERNIZATION." Economy of Ukraine 2022, no. 10 (October 24, 2022): 3–14. http://dx.doi.org/10.15407/economyukr.2022.10.003.
Full textAbstract:
In a war economy, ensuring the stability of price dynamics by the regulation of money supply faces a number of fundamental obstacles that significantly reduce the effectiveness of traditional monetary instruments. During the war, the market principles of economy’s functioning weaken, the monetary transmission mechanisms do not work adequately, the role of the state in ensuring the functioning of commodity-monetary relations increases. This calls for a revision of the macro-stabilizing role of monetary policy. Taking into account the above, approaches to the formulation of monetary policy directions during martial law are summarized, relevant recommendations for the current conditions of Ukraine are substantiated using theoretical sources, advisory and research papers of international organizations and national macroeconomic regulators, as well as statistical databases. Based on the generalization of theoretical principles and world experience, the design of the wartime monetary regime is substantiated, which involves the modification of such aspects as: the target-oriented monetary policy; the composition of interest rates for the central bank’s basic operations; harmonization of monetary policy decisions with fiscal policy priorities; establishment of a fixed exchange rate regime; enhanced control over the cross-border movement of capital. It is concluded that in a war economy, the main contribution of monetary policy to the achievement of macroeconomic stability should be made by the effective interaction with the government in ensuring the stable functioning of government borrowing market, controllability of capital movements, support for the creation of new jobs and generators of new added value for effective closure of new money supply.
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DANYLYSHYN, Bohdan. "ECONOMIC TRANSFORMATIONS DURING MARTIAL LAW: THE TACTICS OF EVOLUTIONISM AND MODERNIZATION." Economy of Ukraine 2022, no. 10 (October 24, 2022): 3–14. http://dx.doi.org/10.15407/economyukr.2022.10.003.
Full textAbstract:
In a war economy, ensuring the stability of price dynamics by the regulation of money supply faces a number of fundamental obstacles that significantly reduce the effectiveness of traditional monetary instruments. During the war, the market principles of economy’s functioning weaken, the monetary transmission mechanisms do not work adequately, the role of the state in ensuring the functioning of commodity-monetary relations increases. This calls for a revision of the macro-stabilizing role of monetary policy. Taking into account the above, approaches to the formulation of monetary policy directions during martial law are summarized, relevant recommendations for the current conditions of Ukraine are substantiated using theoretical sources, advisory and research papers of international organizations and national macroeconomic regulators, as well as statistical databases. Based on the generalization of theoretical principles and world experience, the design of the wartime monetary regime is substantiated, which involves the modification of such aspects as: the target-oriented monetary policy; the composition of interest rates for the central bank’s basic operations; harmonization of monetary policy decisions with fiscal policy priorities; establishment of a fixed exchange rate regime; enhanced control over the cross-border movement of capital. It is concluded that in a war economy, the main contribution of monetary policy to the achievement of macroeconomic stability should be made by the effective interaction with the government in ensuring the stable functioning of government borrowing market, controllability of capital movements, support for the creation of new jobs and generators of new added value for effective closure of new money supply.
7
DANYLYSHYN, Bohdan. "ECONOMIC TRANSFORMATIONS DURING MARTIAL LAW: THE TACTICS OF EVOLUTIONISM AND MODERNIZATION." Economy of Ukraine 2022, no. 10 (October 24, 2022): 3–14. http://dx.doi.org/10.15407/economyukr.2022.10.003.
Full textAbstract:
In a war economy, ensuring the stability of price dynamics by the regulation of money supply faces a number of fundamental obstacles that significantly reduce the effectiveness of traditional monetary instruments. During the war, the market principles of economy’s functioning weaken, the monetary transmission mechanisms do not work adequately, the role of the state in ensuring the functioning of commodity-monetary relations increases. This calls for a revision of the macro-stabilizing role of monetary policy. Taking into account the above, approaches to the formulation of monetary policy directions during martial law are summarized, relevant recommendations for the current conditions of Ukraine are substantiated using theoretical sources, advisory and research papers of international organizations and national macroeconomic regulators, as well as statistical databases. Based on the generalization of theoretical principles and world experience, the design of the wartime monetary regime is substantiated, which involves the modification of such aspects as: the target-oriented monetary policy; the composition of interest rates for the central bank’s basic operations; harmonization of monetary policy decisions with fiscal policy priorities; establishment of a fixed exchange rate regime; enhanced control over the cross-border movement of capital. It is concluded that in a war economy, the main contribution of monetary policy to the achievement of macroeconomic stability should be made by the effective interaction with the government in ensuring the stable functioning of government borrowing market, controllability of capital movements, support for the creation of new jobs and generators of new added value for effective closure of new money supply.
8
DANYLYSHYN, Bohdan. "ECONOMIC TRANSFORMATIONS DURING MARTIAL LAW: THE TACTICS OF EVOLUTIONISM AND MODERNIZATION." Economy of Ukraine 2022, no. 10 (October 24, 2022): 3–14. http://dx.doi.org/10.15407/economyukr.2022.10.003.
Full textAbstract:
In a war economy, ensuring the stability of price dynamics by the regulation of money supply faces a number of fundamental obstacles that significantly reduce the effectiveness of traditional monetary instruments. During the war, the market principles of economy’s functioning weaken, the monetary transmission mechanisms do not work adequately, the role of the state in ensuring the functioning of commodity-monetary relations increases. This calls for a revision of the macro-stabilizing role of monetary policy. Taking into account the above, approaches to the formulation of monetary policy directions during martial law are summarized, relevant recommendations for the current conditions of Ukraine are substantiated using theoretical sources, advisory and research papers of international organizations and national macroeconomic regulators, as well as statistical databases. Based on the generalization of theoretical principles and world experience, the design of the wartime monetary regime is substantiated, which involves the modification of such aspects as: the target-oriented monetary policy; the composition of interest rates for the central bank’s basic operations; harmonization of monetary policy decisions with fiscal policy priorities; establishment of a fixed exchange rate regime; enhanced control over the cross-border movement of capital. It is concluded that in a war economy, the main contribution of monetary policy to the achievement of macroeconomic stability should be made by the effective interaction with the government in ensuring the stable functioning of government borrowing market, controllability of capital movements, support for the creation of new jobs and generators of new added value for effective closure of new money supply.
9
DANYLYSHYN, Bohdan. "ECONOMIC TRANSFORMATIONS DURING MARTIAL LAW: THE TACTICS OF EVOLUTIONISM AND MODERNIZATION." Economy of Ukraine 2022, no. 10 (October 24, 2022): 3–14. http://dx.doi.org/10.15407/economyukr.2022.10.003.
Full textAbstract:
In a war economy, ensuring the stability of price dynamics by the regulation of money supply faces a number of fundamental obstacles that significantly reduce the effectiveness of traditional monetary instruments. During the war, the market principles of economy’s functioning weaken, the monetary transmission mechanisms do not work adequately, the role of the state in ensuring the functioning of commodity-monetary relations increases. This calls for a revision of the macro-stabilizing role of monetary policy. Taking into account the above, approaches to the formulation of monetary policy directions during martial law are summarized, relevant recommendations for the current conditions of Ukraine are substantiated using theoretical sources, advisory and research papers of international organizations and national macroeconomic regulators, as well as statistical databases. Based on the generalization of theoretical principles and world experience, the design of the wartime monetary regime is substantiated, which involves the modification of such aspects as: the target-oriented monetary policy; the composition of interest rates for the central bank’s basic operations; harmonization of monetary policy decisions with fiscal policy priorities; establishment of a fixed exchange rate regime; enhanced control over the cross-border movement of capital. It is concluded that in a war economy, the main contribution of monetary policy to the achievement of macroeconomic stability should be made by the effective interaction with the government in ensuring the stable functioning of government borrowing market, controllability of capital movements, support for the creation of new jobs and generators of new added value for effective closure of new money supply.
10
DANYLYSHYN, Bohdan. "ECONOMIC TRANSFORMATIONS DURING MARTIAL LAW: THE TACTICS OF EVOLUTIONISM AND MODERNIZATION." Economy of Ukraine 2022, no. 10 (October 24, 2022): 3–14. http://dx.doi.org/10.15407/economyukr.2022.10.003.
Full textAbstract:
In a war economy, ensuring the stability of price dynamics by the regulation of money supply faces a number of fundamental obstacles that significantly reduce the effectiveness of traditional monetary instruments. During the war, the market principles of economy’s functioning weaken, the monetary transmission mechanisms do not work adequately, the role of the state in ensuring the functioning of commodity-monetary relations increases. This calls for a revision of the macro-stabilizing role of monetary policy. Taking into account the above, approaches to the formulation of monetary policy directions during martial law are summarized, relevant recommendations for the current conditions of Ukraine are substantiated using theoretical sources, advisory and research papers of international organizations and national macroeconomic regulators, as well as statistical databases. Based on the generalization of theoretical principles and world experience, the design of the wartime monetary regime is substantiated, which involves the modification of such aspects as: the target-oriented monetary policy; the composition of interest rates for the central bank’s basic operations; harmonization of monetary policy decisions with fiscal policy priorities; establishment of a fixed exchange rate regime; enhanced control over the cross-border movement of capital. It is concluded that in a war economy, the main contribution of monetary policy to the achievement of macroeconomic stability should be made by the effective interaction with the government in ensuring the stable functioning of government borrowing market, controllability of capital movements, support for the creation of new jobs and generators of new added value for effective closure of new money supply.
11
Nachane, D. M., and M. Shahidul Islam. "Post‐crisis South Asia: monetary management and macro‐prudential regulation." South Asian Journal of Global Business Research 1, no. 2 (August 17, 2012): 189–209. http://dx.doi.org/10.1108/20454451211252732.
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PurposeThe global crisis, originating in the US financial sector, affected the Asian region primarily through three channels – declining trade volumes, exchange rate pressure and asset deflation. The purpose of this paper is to focus on how the crisis impacted the four major economies of South Asia, viz. Bangladesh, India, Pakistan and Sri Lanka and how, by a combination of swift actions on the monetary, fiscal and exchange rate fronts, the worst consequences of the crisis were averted.Design/methodology/approachThe regulatory and supervisory systems in these four economies are then benchmarked against certain desirable norms, which have emerged out of post‐crisis international deliberations.FindingsIt is felt that the South Asian regulatory systems perform fairly well vis‐à‐vis these norms.Practical implicationsThe paper also touches upon the major highlights of the crisis impact, policy responses and post‐crisis recovery in the Southeast Asian region.Originality/valueThe several similarities and the few contrasts between the two regions on these aspects are also presented.
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Phan Thi Bich, Nguyet, and Thao Pham Duong Phuong. "Association between Securities and Real Estate Markets: The Case of Ho Chi Minh City." Journal of Asian Business and Economic Studies 23, no. 04 (October 1, 2016): 62–79. http://dx.doi.org/10.24311/jabes/2016.23.4.07.
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This study inspects the relationship between the securities market and real estate market in Vietnam, particularly the case of Ho Chi Minh City from Q1/2009 through Q3/2014. Using a comprehensive survey of expert opinions, we find that several macro factors including GDP, interest rate, inflation, fiscal policy, monetary policy, securities market regulations, international capital flows, and money market have effects on both the securities and real estate markets, which, in turn, do have mutual interactions. Furthermore, it is suggested by the survey results that among the determinants, policy on foreign investment control has the most powerful impact on capital movements between the two markets. The results of TECM analysis of property price index and VN-Index reveal a bidirectional causality between the two markets, which are positively related in the long run
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REZNIKOVA, NATALIIA, Volodymyr PANCHENKO, and Oksana IVASHCHENKO. "FROM THE REVISION OF THE ECONOMIC THEORY TO THE REVISION OF THE ECONOMIC POLICY: THE TRAPS OF THE NEW MACROECONOMIC CONSENSUS." Economy of Ukraine 2021, no. 3 (March 25, 2021): 19–40. http://dx.doi.org/10.15407/economyukr.2021.03.019.
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Following on from categories of theoretical and empirical levels of learning, the revision of the modern economic policy instruments is made for the purpose of their compliance with the directions of the (macro)economic theories, determination of the objectives of its actualization, and also revealing its stabilizing and allocative functions in the process of its acquisition of the international economic policy attributes. It’s established that economic theory, which is per se a dynamic, open, and unstable system of the economic knowledge that is based on corresponding assumptions and presumes simplified modeling of the economic processes because of the limitations of the offered methods, demonstrates low explicative ability in the course of analysis requested when choosing one or another economic policy according to the challenges of times. It’s proved that although different economic theories can be an effective tool in the rivalry for unfair intellectual arguments in favor of one or another political decision in particular cases, the economic policy typically doesn’t look like a way of mechanistic implementation of theoretical generalization. Although the rivalry with the help of the analytical arguments between the followers of the fiscal and monetary instruments of the macroeconomic policy allowed to get the intermediate result within the New macroeconomic consensus (NMC) with regard to recognition of the monetary policy precedence in the realization of the low rate of the price advance, the experience of the global financial crisis in 2008 – 2010 and global recession in 2020 threw into question the ability of the stabilization programs developed on the basis of NMC recommendations to achieve the expected results. The experience of the last decade marked with combination of the instability of both cyclical and structural and systemic nature, formed the demand for recognition of the fiscal policy as the stabilization programs’ component of the full value. In a bid for interpretation of the ways and aftermaths of the realization of the international economic policy the demand is made for the forming of the new scientific consensual evaluations and theoretical generalizations.
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Jung, Dong-Hyeon, Sung-Il Choi, Jun-Hyeon Cho, and Ji-Yong Jang. "Labour Policy Reform and Labour Market after Economic Liberalization in India." International Area Review 10, no. 2 (September 2007): 193–219. http://dx.doi.org/10.1177/223386590701000212.
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In 1991, Indian government initiated economic reforms as quite revolutionary. The risks of runaway inflation and default on interest payment to foreign creditors persuaded the Government to borrow from the International Monetary Fund (IMF) and the World Bank on condition of fiscal and economic reforms. The impact of recent economic changes due to reforms on the labour market reveal a mixed picture. While the pace of employment generation picked up after the initial years of reform, the recent years have witnessed reduction in employment growth. Even the most ardent supporter of liberalization would agree that, regardless of how well a Government manages the transition from a regulated to a liberal economy its immediate impact is bad and unjust. It is bad because it reduces economic welfare and unjust because the costs of adjustment fall disproportionately on the poor. Despite liberalization of trade, industry and finance, no law relating to labour has been amended much less repealed so far. This means that the basic material conditions of labour in India will continue to be determined primarily by the macro-economic processes rather than by worker-specific legislation.
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Izotov, Dmitriy. "Economic Policy Responses to COVID-19 of the Northeast Asia Countries." Spatial Economics 17, no. 3 (2021): 156–78. http://dx.doi.org/10.14530/se.2021.3.156-178.
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Once at the epicenter of the original source of the coronavirus spread, the governments of China, the Republic of Korea and Japan introduced immediate administrative measures to isolate the population, which helped to effectively contain the spread of COVID-19 on their territory. The review shows that in the first half of 2020, due to policy of isolation in these Northeast Asia countries, there was a contraction of their economies. The subsequent dynamics of economic growth of the three Northeast Asia countries indicated structural differences in their economies. In the face of economic recession during a COVID-19 pandemic, the governments of Northeast Asia countries are applying stimulating economic policies, with Japan having the largest public spending with respect to its GDP, followed by the Republic of Korea and China. In China, the support for the economy is focused on fiscal policy measures, in the Republic of Korea – monetary and macro-financial policies, in Japan – a combination of policies’ various measures. In the context of a decrease in the coronavirus spread, mid-term estimates indicate that these three countries will be able to maintain positive economic growth rates while investment supporting of the green and digital technologies, including the support through the measures of economic policy. These support measures could have a short- and medium-term positive impact on the economies of the three Northeast Asia countries. However, for the purpose to localizing the pandemic in these countries large fiscal expenditures will contribute to the further growth of their public debt, thereby reducing the national savings rate, restraining the dynamics of their economic growth in the long term
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Ahuja, Deepti, and Venkatesh Murthy. "Social cyclicality in Asian countries." International Journal of Social Economics 44, no. 9 (September 11, 2017): 1154–65. http://dx.doi.org/10.1108/ijse-04-2016-0112.
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Purpose The purpose of this study is to examine the cyclical pattern of social expenditure during 1980-2012 for a set of Asian countries. The extant literature available so far has captured the cyclicality of fiscal policy only for member countries of the Organization for Economic Co-operation and Development and for Latin American countries. Moreover, previous studies have largely ignored Asian countries. Design/methodology/approach The analysis used panel data from global macro-databases of the International Monetary Fund, Statistics of public expenditure for economic development and Asian Development Bank. The cyclical components of social spending (health, education, and social protection) and GDP were determined by using the Hodrick-Prescott Filter. A positive (negative) correlation indicates procyclical (countercyclical) fiscal policy. In line with the existing literature on fiscal cyclicality (Gavin and Perotti, 1997; Lane, 2003; Frankel et al., 2013) that has examined the behavior of fiscal policy over the business cycle, regression analysis is used to examine the impact of political and institutional factors on the behavior of social spending. Findings It was found that government social expenditure is procyclical across Asian countries during 1980-2012. However, during the past decade, emerging Asian countries have been able to shift from procyclical to countercyclical social spending. This shows that they had taken several initiatives to boost expenditure in the social sector – be it in social protection, health, or education services. The significant determinant of social cyclicality is the quality of institutions, which could help the government to increase fiscal deficit during recessions and repay the debt during economic booms. However, to some extent, their countercyclical action is restrained by the high accumulated level of public debt. Originality/value In the context of the Asian region, it is important to understand the cyclical pattern of social policy for several reasons. It has been said that crises offer an opportunity for countries to rethink their social policy to achieve more sustained and equitable development. By studying the social spending behavior, the authors can see whether Asian countries were able to grab the opportunity for reshaping their social and economic agenda after the Asian financial crisis.
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Buracas, Antanas, Algis Zvirblis, and Izolda Joksiene. "Measurement of Entrepreneurship Macro Surrounding Advantages: Country’s Economic Competitiveness Approach." Engineering Economics 23, no. 1 (February 15, 2012): 5–13. http://dx.doi.org/10.5755/j01.ee.23.1.1219.
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The economic development in the newly EU countries is oriented to the restructuring of economy also reduction of the differences in the economic development level of various regions. The enlargement of country’s competitive ability and creation of a modern knowledge-based economy are the priorities of the development. This paper concerns the measurement backgrounds of entrepreneurship macro surrounding advantages as a country’s economic competitiveness determinant that applicable for reasoning of the attitudes and decisions of economic development strategy using multi-attribute decision making methods. In principle, the assumption is made that the measurement must be performed according to the approach to every key determinant as a partial economic competitiveness which is subject of essential primary competitiveness macro factors. The conceptual provisions are foremost focused on the measurement of a totality of the national macro surrounding advantages based on the generalized model which reflects the interdependencies of primary macro factors in a system with account of the impact (vector) of each of them. This study is intended to reveal the deterministic measurement possibilities oriented to the reasoned multiple criteria evaluation methods on the basis adopted for the particular task models. The technique supposes the following procedures: the identification of essential primary macro factors, their quantifiable assessment (in points) as primary criteria allowing the different weights of the impact on economic competitiveness and the composition of task pillars. When examining the primary macro factors, the indicators of global country’s competitiveness index established by the World Economic Forum were taken into account. The whole of the typical primary macrofactors selected by three task pillars (those of specific business infrastructure, common economic surroundings, fiscal and monetary policy macrofactors) is presented. The favorability indexes of each pillar (as partially integrated criteria having different significance) and, in its turn, the generalized measure – macro surroundings favorability index have been determined by applying, in particular, Simple Additive Weighting method. Lithuania‘s macro surrounding advantages were evaluated according to the proposed technique: they may be scored at 54 point (in 100 point system).DOI: http://dx.doi.org/10.5755/j01.ee.23.1.1219
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Irawan, Andi, and Perry Warjiyo. "ANALISIS PERILAKU INSTABILITAS PEREKONOMIAN INDONESIA: PENDEKATAN KETERKAITAN EKONOMI MAKRO, PERDAGANGAN INTERNASIONAL DAN SEKTOR PERTANIAN." Buletin Ekonomi Moneter dan Perbankan 8, no. 3 (February 13, 2007): 1–43. http://dx.doi.org/10.21098/bemp.v8i3.137.
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In general the aim of this study is to investigate short-run relationships among macroeconomy, international trade and agriculture in Indonesia. Under such circumstances, the specific goals of this research is to analyze whicheconomic blocks that have most affected by instability, as well as producing instability in the economy.We apply the Vector Error Correction Model on monthly series data from 1993:01 to 2002:12. The main resultof this study shows asfollow: 1) that the asset financial and the commodity demand blocks the most producing instability in the economy. On the other hand, the export block producing the least instability to the economy. The finding suggest that government should concentrate attention on asset financial andthe commodity demand blocks in stabilizing the economy, as they are major sources of instability of the economy.2) To stabilize the commodity demand, it is also necessary to stabilize the financial market, as the assets demand block is the most contributor of the instability in the commodity demand block. In other words, money demand is the main source of instability. Because money supply is determined bygovernment, the disequlibrium error measure the excess supply of money in the market. This suggest that monetary policy that reduces the disequlibrium error can help stabilize the economy.JEL Classification: C22, F17, Q11, Q18Keyword: Instabilitas, Disequilibrium Error, perdagangan internasional, pertanian, VECM, fiscal policy
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Balogh, Imre. "Slovenian economy in the grip of credit crisis – How to proceed?" Acta Agraria Debreceniensis, no. 63 (February 17, 2015): 19–25. http://dx.doi.org/10.34101/actaagrar/63/1830.
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The Slovenian economy has been through steep ups and downs post-EU accession (2004), and is at the crossroads again. The period 2004–2008 was characterized by balanced monetary and fiscal policies resulting in the adoption of the Euro (2007), coupled with overheated economic growth and propelling corporate indebtedness, fuelled by rapid credit expansion from cheap and abundant foreign funding.
The global financial crisis has exposed the “home-grown” vulnerability of the Slovenian economy, bringing about the second largest GDP fall (9.4%) in the Eurozone after Greece, with a double-dip recession (2009, 2012–13). Growth rebounced in 2014 to 2.6% from its low, but the competitiveness of the Slovenian economy continued to slide in international rankings. For further recovery Slovenia, squeezed by high public debt at 82% of GDP, credit contraction despite EUR 5bn state aid injected into the 70% domestically (basically state) owned banking sector, and the continued threat of massive bankruptcy and debt overhang in the corporate sector, has 3 fundamentally different policy options.
− Profound restructuring of the banking system and the real sector, on the basis of earnest privatization and voluminous FDI inflow.
− Slow creditless recovery due to half-hearted reforms in the financial system and corporate sector.
− Substituting wide-ranging micro level restructuring with Government-stimulated credit expansion, reproducing current tensions in even higher magnitudes in the future.
In the current state of the Slovenian economy, equity-led growth, combined with far-reaching institutional reforms seems the only choice in laying the foundation for long-term sustainable economic development. This study outlines the critical further steps in re-invigorating the financial system, utilizing also the proposals elaborated by the author and his banking team for the Slovenian macro policy decision-makers.
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Zhang, X. "The Coronavirus Will Not Change the long-Term Upward Trend of China’s Economic Development." Finance: Theory and Practice 24, no. 5 (October 24, 2020): 15–23. http://dx.doi.org/10.26794/2587-5671-2020-24-5-15-23.
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The author investigates the impact of COVID‑19 and macro-policy adjustment on China’s economic development. The aim is to describe the situation and trend of China’s economic development before and after COVID‑19. The research method is the comparative data analysis. The study shows that in response to COVID‑19, the Chinese government, on the one hand, has accelerated its opening-up, taken the opportunity of fighting against the pandemic to provide medical assistance to and cooperate with other countries, and actively promoted the building of a community with a shared future for mankind and the process of globalization. On the basis of the Belt and Road Initiative and multilateral, regional, and subregional cooperation mechanisms such as the United Nations, Shanghai Cooperation Organization, BRICS (Brazil, Russia, India, China, South Africa), G20 (Group of 20), and APEC (Asia-Pacific Economic Cooperation), China and the Eurasian Economic Union began to cooperate more frequently and the trade relations between Japan, South Korea, and European developed countries became closer. Meanwhile, committed to building a global interconnection partnership, China actively participates in global economic governance and provides various public products. The Chinese government has proposed “Six Guarantees” on the basis of “Six Stability”. In order to achieve the purpose of stabilizing foreign trade and expanding imports, China has imposed various measures to accelerate the liberalization and facilitation of international trade and investment, such as implementing the new version of the “Foreign Investment Law”, establishing free trade zones, and promoting its experience and organizing international import expositions. Additionally, the Chinese government also implemented targeted fiscal and monetary policies, increased support for enterprises, especially small and medium-sized enterprises, and promoted the construction of “new infrastructure” and innovation of business model, which have formed the driving forces for the transformation of the economic development model in China from traditional business to cloud business, from traditional marketing to live streaming marketing, from traditional sales to online sales. The author concluded thatChina’s adjustment of macro policies in response to COVID‑19 was effective and played an important role in the resumption of production and life, stabilizing foreign trade activities, releasing domestic demand and promoting stable and sustained growth of the economy
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Korneev, Volodymyr. "Functioning of the financial system of Ukraine in extreme conditions of martial law." VUZF Review 7, no. 2 (June 27, 2022): 6–16. http://dx.doi.org/10.38188/2534-9228.22.2.01.
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The study highlights the current features of the financial system of Ukraine. Description and justification of extreme conditions of martial law in the country is a general context for the presentation of the material. It is determined that currently the financial system of Ukraine operates in conditions of non-cyclical stress caused by the war. Smoothing its features and fluctuations requires significant volumes and rapid external financing.
The consolidated actions of international financial organizations and countries in financing the defense and humanitarian budget needs of Ukraine are shown. It is emphasized that the Ukrainian financial system restart in wartime has become one of the main tasks of fiscal and monetary policy of the state to ensure financial and price stability.
Priority tasks for the country's financial system during the war have been identified. They are: attracting the necessary additional resources for macro-financial stabilization, maintaining the purchasing power of the national currency “hryvnia”, curbing inflation, strengthening regulated money circulation. The agreed joint action of the Government and the National Bank of Ukraine in resolving these problems is emphasized.
The changes in the financial sector of the economy functioning are shown in the analysis of activity of the Government of Ukraine, the Ministry of Finance and the National Bank of Ukraine in the context of: a) financing the army and defense needs; b) features of managing the public debt.
The growing role of the state in the periods of cataclysms and war is raised. It is emphasized that the financial authority of the state is the authority of the state budget. It is proved that the current consolidation of public financial management bodies is combined with the consolidation of society and government as a whole.
Post-war restructure of political and economic system of states is expected. Life safety and prudent financing the relevant costs will require reformatting previously familiar standards and institutions. Ukraine's role in the new format of international relations can be seen in the political, economic and military aspects.
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Diaz-Roldan, Carmen, and Carmelo Monteagudo-Cuerva. "Fiscal policy under alternative monetary policy regimes." Business and Economic Horizons 9, no. 2 (July 15, 2013): 1–9. http://dx.doi.org/10.15208/beh.2013.5.
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Abbas, Kalbe, and Tariq Mahmood. "Fiscal Effects of Monetary Seigniorage: A Case Study of Pakistan." Pakistan Development Review 33, no. 4II (December 1, 1994): 1113–19. http://dx.doi.org/10.30541/v33i4iipp.1113-1119.
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The effects of monetary policy on key macro variables have been studied in the literature. In Pakistan most of these studies concentrate on exploring the interdependence of money supply, national income, inflation etc.1 One important, but neglected issue of monetary policy, is its fiscal effects. The fiscal and monetary authorities being parts of the total economic policy machinery, the role of monetary instruments in achieving fiscal objective should not be ignored. In countries like Pakistan where the central bank is under direct control of the government, fiscal policy is often made under the assumption that the monetary policy will be adjusted accordingly.2 There are a number of ways in which monetary policy may lead to fulfilment of some fiscal objectives. These include devaluation, change in interest rate and change in monetary base.
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Fukuda, Shin-ichi. "International transmission of monetary and fiscal policy." Journal of Economic Dynamics and Control 17, no. 4 (July 1993): 589–620. http://dx.doi.org/10.1016/0165-1889(93)90048-w.
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Weale, Martin. "Monetary and Fiscal Policy in Euroland." JCMS: Journal of Common Market Studies 37, no. 1 (March 1999): 153–62. http://dx.doi.org/10.1111/1468-5965.00156.
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Luan, Zehua, Xiangyu Man, and Xuan Zhou. "Understanding the Interaction of Chinese Fiscal and Monetary Policy." Journal of Risk and Financial Management 14, no. 9 (September 3, 2021): 416. http://dx.doi.org/10.3390/jrfm14090416.
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Interaction of fiscal and monetary policy is crucial for macroeconomic stability, especially for an economy with downward pressure as well as a tightened space for macro policy, like China. In this paper, we use a time-varying-parameter (TVP-VAR) model to study Chinese fiscal–monetary interaction and divide it into three periods. We claim that China went through a monetary dominant regime from 1996Q to 2017Q4 since the response of CPI to a fiscal expansion was negative in the short run and about zero in the long run, while the monetary expansion had positive effects on CPI. During this period, the response of government spending and money supply to each other’s shock had the same sign, indicating that the two policies acted as complements. However, we argue that 2008Q4 was a turning point that divided this period into two different periods. The response level of M2 growth rate to a fiscal expansion kept rising from 1996Q1 to 2008Q4, indicating the central bank’s increasingly active cooperation with fiscal policy, while it decreased from 2009Q1 to 2017Q4. Since 2018Q1, the economy has been going through a fiscal dominant regime in that the response of GDP growth rate and CPI to the fiscal expansion has sharply increased. We also argue that the relative change of the role between the two policies should be mainly attributed to the variation in the fiscal authority’s characteristics because fiscal response to a monetary shock has remained at a similar level the whole time, even if there have been changes in the characteristics of the central bank.
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Olisah, Remigius. "MONETARY AND FISCAL POLICY COORDINATION IN NIGERIA." Social Science and Law Journal of Policy Review and Development Strategies 8, no. 1 (November 8, 2021): 116–32. http://dx.doi.org/10.48028/iiprds/ssljprds.v8.i1.09.
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This paper seeks to examine monetary and fiscal policy coordination in Nigeria. It discussed monetary policy as expansionary or contractionary, showing the various tools of monetary policy instruments in the country. Data are generated from secondary sources and evaluated through content analysis. The study is anchored by the Monetarist theory of inflation. Various literature examined shows that with declining oil prices and production challenges in an oil-dependent economy, achieving the growth projection requires better coordination of fiscal and monetary policies in a way that supports the non-oil sector. The government must develop and strengthen effective monetary and fiscal policy using appropriate instruments and international best practices.
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Kholopov, A. "Macroeconomic Policy at a Crossroads." World Economy and International Relations 65, no. 7 (2021): 5–15. http://dx.doi.org/10.20542/0131-2227-2021-65-7-5-15.
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The article examines macroeconomic policy options for advanced economies to respond to adverse shocks in the environment of very low interest rates and very high levels of public debt, when the scope for using conventional policy tools is limited. The standard transmission mechanism of monetary policy in the ELB conditions stops working normally, and the economy faces the “liquidity trap” effect. The deployment by central banks of unconventional monetary tools (forward guidance, quantitative easing, and negative interest rates) after global financial crisis was helpful in combatting the downturn, but carries risk of possible side effects. Large-scale purchases of financial assets lead to significant increase in central banks’ balance sheets, and this creates a threat to future financial stability and central bank independence. Negative interest rates can have detrimental effects on bank profitability and be contractionary through bank lending. There is a consensus that today fiscal policy has to play a major role in stabilizing the business cycle. But the effectiveness of conventional tools of discretional fiscal policy is uncertain because of long political lags and small spending multiplier. Existing automatic fiscal stabilizers are focused on social protection goals and not on macroeconomic stabilization. Thus, the newly proposed measures for rules-based fiscal stimulus (asymmetric semiautomatic stabilizers – tax or spending measures triggered by the crossing of some statistical threshold, e.g. a high unemployment rate) and unconventional fiscal policy (the use of consumption taxes to increase inflation expectations) have become the object of active discussion. Here lies the danger in the fusion of monetary and fiscal policy: central banks’ operations are becoming increasingly quasi-fiscal, aimed at financing budget deficit, and functions of monetary policy are proposed to assign to fiscal policy. Besides, the expansion of fiscal stimulus threatens financial stability in the future, as it leads to increase in public debt and narrows a country’s fiscal space.
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Bryson, Jay H., Henrik Jensen, and David D. van Hoose. "Rules, discretion, and international monetary and fiscal policy coordination." Open Economies Review 4, no. 2 (June 1993): 117–32. http://dx.doi.org/10.1007/bf01000515.
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Sargent, Thomas J. "Ambiguity in American monetary and fiscal policy." Japan and the World Economy 18, no. 3 (August 2006): 324–30. http://dx.doi.org/10.1016/j.japwor.2004.05.006.
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Cao, Xun. "Global Networks and Domestic Policy Convergence: A Network Explanation of Policy Changes." World Politics 64, no. 3 (June 27, 2012): 375–425. http://dx.doi.org/10.1017/s0043887112000081.
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National economies are embedded in complex networks such as trade, capital flows, and intergovernmental organizations (IGOs). These globalization forces impose differential impacts on national economies depending on a country's network positions. This article addresses the policy convergence-divergence debate by focusing on how networks at the international level affect domestic fiscal, monetary, and regulatory policies. The author presents two hypotheses: first, similarity in network positions induces convergence in domestic economic policies as a result of peer competitive pressure. Second, proximity in network positions facilitates policy learning and emulation, which result in policy convergence. The empirical analysis applies a latent-space model for relational/dyadic data and indicates that position similarity in the network of exports induces convergence in fiscal and regulatory policies; position similarity in the network of transnational portfolio investments induces convergence in fiscal policies; and position proximity in IGO networks is consistently associated with policy convergence in fiscal, monetary, and regulatory policies.
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McKibbin, Warwick J. "Macroeconomic Policy in Japan." Asian Economic Papers 1, no. 2 (May 2002): 133–65. http://dx.doi.org/10.1162/15353510260187454.
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This paper explores the composition of the macroeconomic policy packages that would be effective in stimulating the Japanese economy. An empirical econometric model is used to predict the consequences of a monetary stimulus consisting of an open-market purchase of government bonds by the Bank of Japan combined with the announcement and implementation of inflation targeting in Japan. The paper also compares the impacts of permanent, temporary, and phased fiscal adjustments. The model predicts that monetary policy would be effective in stimulating the Japanese economy through causing a depreciation of the yen. Similarly, a substantial fiscal consolidation in Japan would be only mildly contractionary for the first two years but then would yield substantial long-term benefits to the Japanese economy. Combining a credible fiscal contraction that is phased in over three years with an inflation target would be likely to provide a powerful macroeconomic stimulus to the Japanese economy, through a weaker exchange rate and lower long-term real interest rates, and would sustain higher growth in Japan for a decade. Thus, a switch in the macroeconomic policy mix toward a loose monetary policy (e.g., setting inflation targets between 2 and 3 percent) and a tight fiscal policy is likely to be an important part of a successful package of reforms to raise Japanese productivity growth over the coming years.
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Cevik, Serhan. "Policy coordination in fiscal federalism: drawing lessons from the Dubai debt crisis." International Journal of Emerging Markets 14, no. 5 (December 2, 2019): 899–915. http://dx.doi.org/10.1108/ijoem-09-2018-0479.
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Purpose With the global financial crisis, the United Arab Emirates (UAE) experienced its own unraveling of macro-financial imbalances and thus presents an interesting case to analyze the underlying fragilities in federal governments. The purpose of this paper is to investigate the evolution of fiscal policy in the UAE at consolidated and subnational levels in the run-up and after the crisis, and provide pertinent insights about the importance of policy coordination in other federal fiscal systems – and monetary unions, as brought to light by the recent developments in Europe. Design/methodology/approach In measuring the cyclicality of fiscal balances at the consolidated and emirate level in the UAE, this paper uses the non-hydrocarbon primary budget balance, excluding interest spending and hydrocarbon revenues, investment income of the sovereign wealth fund, scaled by non-hydrocarbon GDP. The cyclically adjusted primary balance is estimated by deducting cyclical components from the actual balance. It is important to correct for cyclical changes because the budget balance tends to vary endogenously according the state of the economy – deteriorating during a bust and improving in a boom. Furthermore, since hydrocarbon revenues are dependent on the erratic behavior of hydrocarbon prices, the cyclically adjusted non-hydrocarbon primary balance is computed, using the elasticity of non-hydrocarbon revenues and primary expenditures relative to non-hydrocarbon GDP, to assess whether fiscal policy exacerbates economic fluctuations in the UAE at the aggregate and emirate levels. Findings The empirical findings show that procyclical fiscal policies prior to the crisis reinforced the financial sector cycle, exacerbated the economic upswing, and thereby contributed to the build-up of macro-financial vulnerabilities. The paper also sets out policy lessons to develop a rule-based fiscal framework that would help strengthen fiscal policy coordination between the various layers of government and ensure long-term fiscal sustainability and a more equitable intergenerational distribution of wealth. Originality/value The lack of fiscal policy coordination among subnational governments complicates macro-economic management at the federal level. Since the UAE has a pegged exchange rate regime and consequently a limited scope to use monetary policy, the burden of macro-economic stabilization falls on fiscal policy. Accordingly, this paper shows that procyclical fiscal policies prior to the crisis reinforced the “financial accelerator” effect, exacerbated the economic cycle, and thereby contributed to the build-up of economic and financial vulnerabilities in the UAE.
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K, Nurjannah Rahayu, and Phany Ineke Putri. "Mundell-Fleming Model: The Effectiveness of Indonesia�s Fiscal and Monetary Policies." JEJAK 10, no. 1 (March 10, 2017): 223–35. http://dx.doi.org/10.15294/jejak.v10i1.9137.
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This study examines the fiscal and monetary policy in Indonesia using the Mundell-Fleming model. The main objective of this study was to determine which policies are effective between fiscal and monetary policies of the national income in Indonesia because Indonesia is a small open economy with not perfect capital mobility. The analysis technique used is Two Stage Least Square (TSLS) by using secondary data base on International Financial Statistics, 2000.I 2014.II . The research result is monetary policy is more effective than the fiscal policy in which monetary policy multiplier at 0.0028 greater than fiscal policy multiplier 0.001316. The results are consistent with the theory of the Mundell-Fleming.
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Janković, Irena, Svetlana Popović, and Velimir Lukić. "EU monetary and fiscal policy responses to the COVID-19 crisis." Ekonomika preduzeca 69, no. 6-7 (2021): 333–44. http://dx.doi.org/10.5937/ekopre2106333j.
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The COVID-19, or, the coronavirus crisis represents an unprecedented global threat in recent history that, as symmetric external shock, affects social and economic dynamics of different countries and regions on both macro and micro levels. The aim of the paper is to provide a critical overview of economic policy responses to the ongoing crisis in the EU and, in particular, the eurozone. The paper tends to answer the question whether proposed monetary and fiscal actions provide feasible risk mitigating tools for the ongoing crisis or are there some viable policy actions that are omitted?
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Clark, William Roberts, and Mark Hallerberg. "Mobile Capital, Domestic Institutions, and Electorally Induced Monetary and Fiscal Policy." American Political Science Review 94, no. 2 (June 2000): 323–46. http://dx.doi.org/10.2307/2586015.
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The literature on global integration and national policy autonomy often ignores a central result from open economy macroeconomics: Capital mobility constrains monetary policy when the exchange rate is fixed and fiscal policy when the exchange rate is flexible. Similarly, examinations of the electoral determinants of monetary and fiscal policy typically ignore international pressures altogether. We develop a formal model to analyze the interaction between fiscal and monetary policymakers under various exchange rate regimes and the degrees of central bank independence. We test the model using data from OECD countries. We find evidence that preelectoral monetary expansions occur only when the exchange rate is flexible and central bank independence is low; preelectoral fiscal expansions occur when the exchange rate is fixed. We then explore the implications of our model for arguments that emphasize the partisan sources of macroeconomic policy and for the conduct of fiscal policy after economic and monetary union in Europe.
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Tetik, Metin, and Mustafa Ozan Yıldırım. "Distortionary effects of economic crises on policy coordination in Turkey: Threshold GMM approach." Economics and Business Review 7, no. 3 (2021): 83–102. http://dx.doi.org/10.18559/ebr.2021.3.6.
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This study investigates the interaction between fiscal and monetary policies and how crises affect the coordination between policymakers in Turkey. This study’s novelty is that a nonlinear Taylor rule indicating monetary policy response function is estimated based on the Threshold Generalized Method of Moments (Threshold GMM) methodology over the period January 2006—March 2020. The empirical findings reveal that when fiscal policy has an expansionary stage, especially in crises times, the policy interest rate does not react significantly to the inflation gap, output gap and real effective exchange rate gap in expansionary periods. On the contrary the policy interest rate gives statistically important responses to these variables during contractionary fiscal policy periods. Thus, the effectiveness of the Taylor rule appears in a period of contractionary fiscal policy. This situation gives rise to the significant policy implication that the monetary policymaker’s success in controlling inflation increases with the contractionary fiscal policy. Finally, it has been observed that effective coordination between monetary and fiscal policies did not occur during crisis periods, but compatible coordination was achieved in other periods.
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Bengali, Kaiser, and Qazi Masood Ahmed. "Stabilisation Policy vs. Growth-oriented Policy: Implication for the Pakistan Economy." Pakistan Development Review 40, no. 4II (December 1, 2001): 453–66. http://dx.doi.org/10.30541/v40i4iipp.453-466.
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Pakistan has initiated a comprehensive reforms efforts aiming at tracking the economy on a higher and sustainable economic growth, reduce level of poverty, reducing unemployment, raising their level of standard of living. These objective were to be achieved through a programme that would build on the macro-economic stability which encompasses structural reforms, trade liberalisation, privatisation, fiscal reforms and financial sector. This paper makes one of the early attempt to analyse the Pakistan stabilisation experiences. In Pakistan the stabilisation programme was started in 1988-89. In this paper we mainly examine the fiscal and monetary policy package since 1988 when the Pakistan committed to a set of conditionalities under the Structural Adjustment Programme of the IMF. The fundamental question that has risen was the relative efficacy of stabilisation oriented versus growth oriented policies on development and welfare. Admittedly, stabilisation and growth are not mutually exclusive and any policy package has to incorporate both the elements. However, the manner in which the policy has been implemented in Pakistan has tended to pursue stabilisation at the expense of growth.
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Salvary, Stanley C. W. "Monetary Policy And Not Monetary Control: A Rethinking." Journal of Applied Business Research (JABR) 14, no. 1 (September 1, 2011): 91. http://dx.doi.org/10.19030/jabr.v14i1.5731.
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The view that prediction is the only important concern when policy is to be developed has led to the strict adherence to a money supply rule via the Quantity Theory of Money with its debilitating consequences. The monetarists place the emphasis on the level of the money supply in the determination of price level changes and monetary control is exercised. Along with this line of thinking, statistical elegance transcends empirical reality. Thus, the ensuing consequences of monetary control are not surprising. There are continuous increases in the general level of pries and increasing problems of unemployment, which fuel the flames of business downsizing. In this paper, an alternative to the monetarist explanation of the determination of the price level is advanced. The alternative explanation does not rely on changes in the supply of money but on changes in the composition of aggregate demand and supply. Absent monetary dislocation or revaluation of the currency, change in the general price level is attributed to the net effect of the realignment of relative prices. It is argued that a rethinking of the situation would results in monetary policy that is compatible with the economic setting and not monetary control which crowds out fiscal policy.
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Watt, Andrew, and Volker Hallwirth. "The policy mix and policy coordination in EMU - how can it contribute to higher growth and employment?" Transfer: European Review of Labour and Research 9, no. 4 (November 2003): 610–32. http://dx.doi.org/10.1177/102425890300900407.
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This article makes a case for improved coordination between the three main areas of economic policy - monetary, fiscal and wage policy - in the context of EMU. Focusing in particular on the monetary-wage policy link, it argues that, in an uncertain world, a coordinated macro policy mix would produce superior results than the current policy assignment, raising the rate at which the European economy can grow without inflationary pressures. However, such a strategy must overcome a number of practical difficulties and political opposition. The Macroeconomic Dialogue could provide a forum for discussions between policy actors on a more cooperative, growth and employment-oriented strategy. Trade unions must play a key role both in coordinating their wage policies and in promoting greater interaction with the other policy-mix actors.
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Skousen, Mark. "The Perseverance of Paul Samuelson's Economics." Journal of Economic Perspectives 11, no. 2 (May 1, 1997): 137–52. http://dx.doi.org/10.1257/jep.11.2.137.
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A reflection of the economics profession through Paul Samuelson's Economics. Samuelson offers an uneasy mix of laissez faire in micro and government interventionism in macro. In earlier editions, Keynesian thinking dominated, with an antisaving, progovernment bias and a need for an activist fiscal policy aimed at alleviating unpredictable chronic business cycles under private enterprise. Middle editions had chapters on the Soviet Union and China, rather than Japan and West Germany. Recently, Samuelson and coauthor William Nordhaus have gradually shifted from antithrift to prosavings policies, from deficit spending to fiscal restraint, and from fiscal policy to monetary policy as effective countercyclical tools.
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Ubid, Basim Khamees. "Analysis of the Relationship between Fiscal Policy Shocks and Monetary Stability in Iraq's Economy for the Period 1990-2018." International Academic Journal of Economics 9, no. 1 (May 16, 2022): 11–19. http://dx.doi.org/10.9756/iaje/v9i1/iaje0902.
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The research aims to measure the impact of positive and negative fiscal policy shocks on monetary stability in Iraq, which represents monetary stability as an indicator of real and price stability. Fiscal policy shocks are quantitative changes in public spending and public revenue affecting the output and price cycle, and fiscal policy despite the accompanying time gaps, but it remains a policy Influential and has a significant degree of impact on economic growth and development in developing countries. The fiscal policy represents a numerical translation of the economic and social objectives planned in the state's general budget tool consistent with the GDP cycle. The economic and social goals stem from the core of the functions and the main objectives of the fiscal policy, namely the allocation of resources, stability and restoration Distribution and these functions, as we know, free market techniques may fail to achieve them, which interferes with the financial policy to address the failure of the market to reach the set goals, and that coordination between fiscal and monetary policies does not mean a loss of independence as much as it means correcting fiscal and monetary policies without causing undesirable adverse effects upon the necessary correction. For local courses Opposing this coordination, and we have touched on the monetary stability index adopted by the International Monetary Fund (IMF) to discuss the impact of financial shocks on the monetary stability index in Iraq, where the Iraqi economy witnessed positive fiscal and revenue policy shocks with limited negative financial shocks in spending. Public and public revenue and the impact was studied through the existence of long-term relationships that link fiscal policy shocks, i.e. quantitative changes in public spending and public revenue on monetary stability. The boundary test within the Autoregression techniques of distributed Lag demonstrated the existence of a long-term relationship between fiscal policy shocks and monetary stability in Iraq.
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Asongu, Simplice. "Are proposed African monetary unions optimal currency areas? Real, monetary and fiscal policy convergence analysis." African Journal of Economic and Management Studies 5, no. 1 (April 1, 2014): 9–29. http://dx.doi.org/10.1108/ajems-02-2012-0010.
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Purpose – A spectre is hunting embryonic African monetary zones: the European Monetary Union crisis. The purpose of this paper is to assess real, monetary and fiscal policy convergence within the proposed WAM and EAM zones. The introduction of common currencies in West and East Africa is facing stiff challenges in the timing of monetary convergence, the imperative of central bankers to apply common modeling and forecasting methods of monetary policy transmission, as well as the requirements of common structural and institutional characteristics among candidate states. Design/methodology/approach – In the analysis: monetary policy targets inflation and financial dynamics of depth, efficiency, activity and size; real sector policy targets economic performance in terms of GDP growth at macro and micro levels; while, fiscal policy targets debt-to-GDP and deficit-to-GDP ratios. A dynamic panel GMM estimation with data from different non-overlapping intervals is employed. The implied rate of convergence and the time required to achieve full (100 percent) convergence are then computed from the estimations. Findings – Findings suggest overwhelming lack of convergence: initial conditions for financial development are different across countries; fundamental characteristics as common monetary policy initiatives and IMF-backed financial reform programs are implemented differently across countries; there is remarkable evidence of cross-country variations in structural characteristics of macroeconomic performance; institutional cross-country differences could also be responsible for the deficiency in convergence within the potential monetary zones; absence of fiscal policy convergence and no potential for eliminating idiosyncratic fiscal shocks due to business cycle incoherence. Practical implications – As a policy implication, heterogeneous structural and institutional characteristics across countries are giving rise to different levels and patterns of financial intermediary development. Thus, member states should work towards harmonizing cross-country differences in structural and institutional characteristics that hamper the effectiveness of convergence in monetary, real and fiscal policies. This could be done by stringently monitoring the implementation of existing common initiatives and/or the adoption of new reforms programs. Originality/value – It is one of the few attempts to investigate the issue of convergence within the proposed WAM and EAM unions.
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Tung, Le Thanh. "Fiscal Policy, Monetary Policy and Price Volatility: Evidence from an Emerging Economy." Organizations and Markets in Emerging Economies 12, no. 1 (May 20, 2021): 57–70. http://dx.doi.org/10.15388/omee.2021.12.47.
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Vietnam is an Asian emerging country, which now is ranked in the group of the fastest-gro- wing economies worldwide. However, this economy has faced galloping inflation in recent years. So the Vietnamese experience is a valuable reference for the policymakers in the developing world in order to successfully control price volatility. Our study applies the Vector autoregressive method, the Johansen cointegration test, and the Granger causality test to examine the impact of fiscal and monetary policy on price volatility in Vietnam with a quarterly data sample collected over the period from 2004 to 2018. The study results confirm the existence of a long-term cointegration relationship between these policies and price volatility in Vietnam. Besides, the variance decomposition and impulse response function also show that the impact of these policies on inflation is clear, however, the fiscal policy more strongly affects inflation than the monetary policy. Finally, the Granger causality test also indicates one-way causality relationships from the government expenditure as well as the exchange rate to price volatility in the study period.
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Libich, Jan, and Dat Thanh Nguyen. "Macro Meets Micro: Stochastic (Calvo) Revisions in Games." B.E. Journal of Theoretical Economics 14, no. 1 (January 1, 2014): 339–69. http://dx.doi.org/10.1515/bejte-2013-0042.
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AbstractThe timing of moves in conventional games is deterministic. To better capture the uncertainty of many real world situations, we postulate a stochastic timing framework. The players get a revision opportunity at a pre-specified time (common to them) with some known probability (different across them). The probabilistic revisions resemble the Calvo (1983) timing widely used in macroeconomics, and by nesting the standard simultaneous move game and Stackelberg leadership they can serve as a “dynamic commitment” device. The analysis shows how the revision time and probabilities affect the outcomes in games with multiple and/or inefficient equilibria. Unsurprisingly, we show in the Battle of the sexes that commitment – low revision probability relative to the opponent – improves the player’s chances to uniquely achieve his preferred outcome (i.e. to dominate). What may, however, seem surprising is that the less committed (higher revision probability) player may dominate the game under some circumstances (for which we derive the necessary and sufficient conditions). This is in contrast to the intuition of Stackelberg leadership where the more committed player (leader) always does so. The paper then applies the framework to the strategic interaction between monetary and fiscal policies in the aftermath of the Global financial crisis. It is modelled as the Game of chicken in which a double-dip recession and deflation can occur when both policies postpone stimulatory measures – attempting to induce the other policy to carry them out. In order to link our theoretic results to the real world, we develop new indices of monetary and fiscal policy leadership (pre-commitment) and quantify them using institutional characteristics of high-income countries. This exercise shows that the danger of the undesirable deflationary scenario caused by a monetary–fiscal policy deadlock may be high in some major economies.
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Steinbach, Armin. "The greening of the Economic and Monetary Union." Common Market Law Review 59, Issue 2 (April 1, 2022): 329–62. http://dx.doi.org/10.54648/cola2022028.
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All pillars of the Economic and Monetary Union (EMU) have unleashed an array of measures to transform the economy towards climate neutrality. With the Green Deal, the strategy review of the European Central Bank (ECB), and the growing body of sustainable finance legislation, climate considerations have entered the traditional mandates governing the conduct of financial, fiscal, and monetary policy. The cross-sectional nature of climate issues reinforces the interdependence and coordination of EMU policies. This article explores changes to EMU architecture and discusses the institutional and legal implications of the novel role of climate in the coordination of EMU policies. It addresses the relationship between Treaty mandate and policy leeway, specifically the way in which the ECB extends its focus on price stability to account for climate considerations and the fiscal legal framework relies on flexibility to incentivize climate investment. It also tracks the emergence of climate stability as an EMU concept, adding to existing concepts of price, fiscal and financial stability. EMU, ECB, monetary policy, financial policy, fiscal policy, climate change, sustainable finance, greenflation, policy coordination
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Murai, Taiki, and Gunther Schnabl. "Macroeconomic Policy Making and Current Account Imbalances in the Euro Area." Credit and Capital Markets – Kredit und Kapital: Volume 54, Issue 3 54, no. 3 (July 1, 2021): 347–73. http://dx.doi.org/10.3790/ccm.54.3.347.
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The paper analyses the role of fiscal and monetary policy for the development of the current account imbalances in the euro area, including the most recent developments during the coronavirus crisis. Several financial transmission channels such as international bank lending, changes in TARGET2 balances, international rescue credit and government bond purchases of euro area central banks are identified. It is found that differing fiscal policy stances which have interacted differently with the ECB’s monetary policy have been at roots of first diverging and then converging current account positions in the euro area. Since the European financial and debt crisis, public financing mechanisms and the unconventional monetary of the ECB have contributed to the persistence of intra-euro area current account imbalances.
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Barrell, Ray, Tatiana Fic, and Iana Liadze. "Fiscal Policy Effectiveness in the Banking Crisis." National Institute Economic Review 207 (January 2009): 43–50. http://dx.doi.org/10.1177/0027950109103678.
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We investigate the effects of changes in taxes using the National Institute international macro model, NiGEM. A comparison on fiscal impulses worth 1 per cent of GDP for one year is made, with a comparison of a direct tax change, indirect tax change, and a lump sum payment. Multipliers are assessed one country at a time and when policy is coordinated to increase its impacts. We look at the importance of releasing borrowing constraints in a banking crisis. The analysis assumes financial and foreign exchange markets are forward looking.
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Cooper, Richard N., and Daniel Gros. "Fiscal and Monetary Policy for a Low-Speed Europe." Foreign Affairs 81, no. 6 (2002): 186. http://dx.doi.org/10.2307/20033368.
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Khalid, Mahmood, Wasim Shahid Malik, and Abdul Sattar. "The Fiscal Reaction Function and the Transmission Mechanism for Pakistan." Pakistan Development Review 46, no. 4II (December 1, 2007): 435–47. http://dx.doi.org/10.30541/v46i4iipp.435-447.
Full textAbstract:
Modern macroeconomics literature emphasises both the short run and long run objectives of fiscal policy [Romer (2006)]. In the short run it can be used to counter output cyclicality and/or stabilise volatility in macro variables, which is descriptively same as of effects of the short run monetary policy. Further for the long-run, fiscal policy can also affect both the demand and supply side of the economy. But in most traditional analyses it is assumed that fiscal policy would adjust to ensure the intertemporal budget constraint to be satisfied, while monetary policy is free to adjust its instruments [‘Ricardian Regime’ by Sargent (1982)] such as stock of money supply or the nominal interest rate [Walsh (2003)]. The debt financing methods, expenditure and tax powers of fiscal authorities i.e. the fiscal policy has also been seen as to affect both the supply and demand side of the economy. As noted by Baxter and King (1993), the initial Real Business Cycle models had only the supply side effects of the fiscal policy, where these were transmitted through the wealth effect and labourleisure choices of the household. Recently also New-Keynesian type models with micro-foundations and sticky prices argue that still through the supply side fiscal policy management could be accorded for stabilisation [Linnemann and Schabert (2003)]. The demand side effects of the fiscal policy could also be found only with more imperfections such as ‘Rule of Thumb’ consumers or those with liquidity constraints, which lead to exclusion of Ricardian equivalence [Gali, et al. (2005)]. But all that depends on the structure of the economy, as Blanchard and Perotti (2002) stated: